“I  stand  for  the  economic  verities;  I stand  for  the  logfc  of  conditions.”— Page  36. 


The 


Return  this  book  on  or  before  the 
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An  Earnest 
Official 
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Investigate 

before 

Investing. 

By  JOSEPH  NIMMO,  Jr. 

j 

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An  Earnest  Plea  for  a Thorough  and  Impartial 
Official  Investigation  of  the  Economic,  Com- 
mercial, nilitary  and  Political  Aspects  of  the 
Nicaragua  Canal. 


PRICE  10  CENTS. 


Published  by 

Rufus  H.  Darby,  1308  Pennsylvania  Avenue, 
Washington,  D.  C. 


Ill 


Synopsis  of  the  Argument  in  Favor  of  the  Investigation 
of  the  Nicaragua  Canal  Project  by  Order  of  Congress. 

The  considerations  which  indicate  the  necessity  of  thorough  and  im- 
partial investigation  of  the  economic,  commercial,  military  and  political 
aspects  of  the  Nicaragua  Canal  project  by  a commission  or  commissions 
to  be  created  by  Congress  are  summarily  stated  as  follows  : 

I.  — No  such  investigation  has  ever  been  instituted  by  Congress. 

II.  — The  proponents  of  the  Nicaragua  Canal  have  from  the  begin- 
ning opposed  such  investigation  and  now  oppose  it. 

III.  — The  Maritime  Canal  Company  of  Nicaragua  attempted  to  con- 
struct the  canal  as  a commercial  enterprise  but  failed  in  the  attempt 
and  is  now  bankrupt. 

IV.  — Three  of  the  most  enlightened  nations  of  Europe  have,  for 
reasons  which  apply  to  the  Nicaragua  Canal,  blundered  egregiously  in 
the  construction  of  ship  canals,  viz  : The  Liverpool  and  Manchester 
Canal  of  England,  the  Kiel  Canal  of  Germany,  and  the  Corinth  Canal  of 
Greece. 

V.  — The  economic  and  commercial  considerations  which  indicate 
the  necessity  for  such  investigation  are  as  follows: 

1.  The  conditions  of  distance,  coaling  facilities  and  lockage  are  so 
largely  in  favor  of  the  Suez  Canal  route  as  against  the  Nicaragua  Canal 
route  that  the  former  will  for  all  time  command  the  commerce  of  Asia 
and  Australasia  with  Europe  and  ports  on  the  eastern  seaboard  of  the 
United  States. 

2.  Rates  and  facilities  for  transportation  afforded  by  transconti- 
nental railroads  preclude  any  considerable  commerce  between  Atlantic 
and  Pacific  Coast  ports  of  the  United  States  by  the  Nicaragua  Canal 
route,  and  absolutely  prevent  commerce  between  the  Pacific  Slope  and 
the  great  interior,  west  of  the  Appalachian  range. 

3.  The  idea  that  water  lines  always  determine  the  rates  on  competing 
railroads  is  fallacious.  On  the  other  hand,  railroads  as  a rule  regulate 
and  greatly  reduce  rates  on  competing  water  lines,  change  the  character 
of  their  traffic,  and  in  many  instances  have  utterly  ruined  water  lines 
for  commercial  purposes. 

4.  The  Nicaragua  Canal  would  not  exert  any  effective  ^regulating  in- 
fluence over  transcontinental  rail  rates ; on  the  other  hand  the  trans- 
continental railroads  would  not  only  determine  rates  by  the  Nicaragua 
Canal  route  but  prevent  the  carriage  of  passengers,  mails,  express 
goods  and  general  merchandise  by  that  route  and  greatly  limit  the 


P 3 


IV 


magnitude  of  its  traffic  even  as  to  the  lowest  classes  of  freights.  A sin- 
gle railroad,  competing  with  the  Suez  Canal  as  sharply  as  would  each 
one  of  the  six  transcontinental  railroads  of  the  United  States  with  the 
Nicaragua  Canal,  would  so  deplete  the  traffic  of  the  former  as  to  ruin  it 
financially  and  render  it  of  small  commercial  value. 

5.  The  commerce  of  San  Francisco  and  other  Pacific  Coast  ports  with 
China,  Japan,  Australia,  the  Philippine  Islands  and  the  Hawaiian  Islands 
will  never  become  tributary  to  the  Nicaragua  Canal  route  for  the  rea- 
sons just  stated  in  regard  to  transcontinental  traffic. 

6.  The  Nicaragua  Canal  route  will  not  be  able  to  compete  for  the 
transportation  of  coal,  cotton  or  lumber  for  reasons  presented  in  this 
statement. 

7.  The  foreign  commerce  of  the  western  coast  of  the  American  Con- 
tinent, south  of  California,  is  limited  by  the  fact  that  the  dividing  ridge 
of  this  continent  is  near  its  western  seacoast.  Besides  a considerable 
part  of  that  coast  is  arid  and  uninhabited. 

8.  The  possible  traffic  of  the  Nicaragua  Canal  from  the  commerce  of 
the  western  seacoast  of  the  entire  American  Continent  with  ports  on 
the  eastern  side  of  that  continent  and  with  Europe  is  greatly  limited 
by  the  fact  that  the  Nicaragua  Canal  will  not  be  available  for  sailing 
vessels  on  account  of  lack  of  wind  and  other  climatic  conditions.  For 
a similar  reason  no  sailing  tonnage  ever  passes  through  the  Suez  Canal. 

9.  The  Nicaragua  Canal  will  never  be  available  for  steam  navigation 
between  ports  on  the  western  coast  of  South  America,  south  of 
Peru,  and  the  eastern  seaboard  of  the  United  States,  or  with  Europe  for 
the  reason  that  the  conduct  of  such  navigation  embraces  intermediary 
trade  at  the  principal  ports  on  the  Atlantic  Coast  of  South  America. 

10.  The  Nicaragua  Canal  route  will  not  compete  successfully  with 
the  Panama  Railroad  route  for  the  trade  of  ports  between  Callao  and 
Panama  with  respect  to  the  carriage  of  passengers,  the  mails,  express 
goods  and  general  merchandise. 

11.  The  total  amount  of  tonnage  which  could  be  secured  for  the  Nica- 
ragua Canal  would  not  exceed  300,000  tons  annually.  This  traffic 
would  not  at  any  obtainable  rate  of  tolls  pay  even  the  cost  of  maintain- 
ing the  canal. 

12.  The  Nicaragua  Canal  is  not  on  the  line  of  any  important  com- 
mercial movement. 

VI. — MILITARY  CONSIDERATIONS  WHICH  DEMAND  IN- 
VESTIGATION. 

Assuming  that  the  United  States  will  be  able  to  acquire  full  military 
control  of  the  Nicaragua  Canal  the  considerations  which  demand  a. 


V 


thorough  and  impartial  investigation  of  the  Nicaragua  Canal  project 
are  as  follows  : 

1.  The  military  control  of  the  Nicaragua  Canal  by  the  Government 
of  the  United  States  would  involve  expensive  fortifications  at  both  ends 
and  the  constant  military  protection  of  many  important  points  along 
the  line  of  the  canal,  viz:  Locks,  embankments,  sluice-ways,  dams  and 
culverts.  This  would  involve  a large  expenditure  of  money  and  of 
military  power. 

2.  The  adequate  protection  of  the  Nicaragua  Canal  in  time  of  war 
would  involve  the  protection  of  each  end  of  the  canal  by  naval  vessels. 

3.  If  the  Nicaragua  Canal  had  been  completed  on  the  first  of  March, 
1898,  the  passage  of  the  war* ship  Oreg07i  through  it  would  have  required 
the  protection  of  so  large  a military  force,  including  detachments  from 
the  Army  and  the  Navy,  as  to  have  necessitated  the  voyage  which  that 
ship  actually  made  by  the  Cape  Horn  route. 

4.  Eight  hundred  thousand  troops  with  all  their  accoutrements  of 
war,  can  now  be  transported  across  the  continent  by  rail  within  twenty 
days.  This  affords  to  the  United  States  a most  important  military  ad- 
vantage over  any  other  nation. 

5.  It  will  cost  the  Government  much  less  to  construct  and  maintain 
an  adequate  naval  force  on  both  sides  of  the  continent  than  to  construct 
and  maintain  the  Nicaragua  Canal,  especially  in  view  of  the  fact  that  it 
would  be  of  inconsiderable  commercial  value. 

6.  The  maintenance  of  an  adequate  naval  force  on  both  the  Atlantic 
and  Pacific  Coasts  of  the  United  States  would,  from  the  military  point  of 
view,  be  preferable  to  shifting  great  war-ships  from  one  side  of  the  con- 
tinent to  the  other  in  time  of  war,  either  by  the  way  of  Nicaragua  or 
Cape  Horn. 

VII.— POLITICAL  CONSIDERATIONS  WHICH  DEMAND  IN- 
VESTIGATION. 

1.  The  Clayton- Bulwer  Treaty  interposes  an  absolute  barrier  to  the 
acquisition  of  military  control  of  the  Nicaragua  Canal  by  the  Govern- 
ment of  the  United  States.  That  treaty  provides  that  neither  Great 
Britain  nor  the  United  States  shall  in  peace  or  in  war  ever  acquire  “any 
exclusive  control  over  the  said  ship  canal,”  that  “neither  will  erect  or 
maintain  any  fortifications  commanding  the  same,”  and  that  the  two 
governments  will  guarantee  the  neutrality  of  the  canal  and  invite  other 
nations  to  enter  into  similar  agreements  with  them. 

2.  The  Clayton-Bulwer  Treaty  is  still  in  force.  This  is  maintained 
by  the  ablest  statesmen  and  publicists  of  this  country  and  by  every 
statesman  of  Great  Britain. 


VI 


3.  Secretary  Blaine  held  that  the  Clayton- Bui wer  Treaty  affords  to 
Great  Britain  greater  commercial  and  military  advantages  than  it  affords 
to  the  United  States. 

4.  Under  the  provisions  of  the  Clay  ton- Bui  wer  Treaty  the  exclusive 
military  advantage  held  by  the  United  States  of  being  able  to  transport 
men  and  munitions  of  war  across  the  continent  would  disappear,  as  the 
neutrality  of  the  canal  would  enable  any  foreign  nation  to  transport  its 
troops  and  munitions  of  war  through  it. 

5.  The  government  of  Nicaragua  has  granted  to  a British  company 
the  exclusive  right  of  steam  navigation  on  the  San  Juan  River,  and 
certain  exclusive  rights  to  build  railroads  in  that  country.  The  govern- 
ment of  Nicaragua  has  also  recently  granted  the  right  to  construct  the 
Nicaragua  Canal  to  an  American  company,  thus  terminating  the  rights 
which  have  been  held  by  the  Maritime  Canal  Company  of  Nicaragua. 

6.  The  manifest  duty  of  the  Government  of  the  United  States  is  to 
investigate  before  investing. 

The  fact  of  chief  importance  presented  in  this  document  is  that  the 
proponents  of  the  Nicaragua  Canal  estimate  its  traffic  at  5,281,748  tons 
annually.  This  is  a sort  of  average  of  several  unauthentic  estimates  or 
guesses  by  persons  interested  in  the  subject  of  an  American  isthmian 
canal,  none  of  which  estimates  are  of  any  governmental  authority.  The 
only  governmental  report  issued  in  this  country  upon  the  probable  ton- 
nage of  such  a canal  is  the  one  which  I submitted  as  chief  of  the  Bureau 
of  Statistics,  August  7,  1880,  at  the  request  of  the  American  Society  of 
Civic  Engineers.  In  that  report  I stated  the  probable  tonnage  of  any 
American  interoceanic  canal  at  about  1,625,000  tons  annually.  This 
statement  was  carefully  revised  in  the  year  1895,  when  I found  that  as 
the  result  of  changed  conditions,  the  proposed  canal  could  not  secure 
over  300,000  tons  annually.  The  estimates  of  proponents  of  the  Nicaragua 
Canal  in  recent  years  are  about  twenty  times  that  amount.  I ask  for  a 
thorough  and  impartial  governmental  investigation  in  order  to  deter- 
mine the  question  thus  raised. 


JOSEPH  NIMMO,  Jr. 


THE  NICARAGUA  CANAL. 


INVESTIGATE  BEFORE  INVESTING. 


By  JOSEPH  NIMMO,  Jr. 

The  article  in  the  Forum  for  November,  1898,  by  ex- 
Senator  Warner  Miller,  presents  oft-repeated  specula- 
tions and  predictions  in  regard  to  the  enormous  advan- 
tages which  it  is  assumed  will  be  realized  from  the 
construction  of  the  Nicaragua  Canal.  Mr.  Miller,  how- 
ever, carefully  refrains  from  any  recognition  of  the  fact 
that  Congress  has  never  yet  ordered  any  investigation 
of  the  commercial  and  military  aspects  of  the  project. 
Nor  does  he  allude  to  the  fact  that  the  proponents  of 
the  scheme  have  been  repeatedly  and  earnestly  re- 
quested to  join  in  a petition  to  Congress  to  submit  all 
questions  in  regard  to  its  practicability  to  thorough  and 
impartial  official  inquiry.  They  have  persistently  op- 
posed such  inquiries.  The  governmental  duty  of  thor- 
oughly investigating  the  proposed  scheme  before  invest- 
ing in  it  is  so  manifest  as  to  need  no  argument  to  prove 
its  necessity.  It  would  be  discreditable  to  this  nation 
and  to  the  intelligence  of  the  age  for  the  Government 
of  the  United  States  to  embark  in  this  or  in  any  other 
costly  enterprise  without  first  instituting  a full  and 
impartial  investigation  as  to  its  probable  value. 

There  are  many  weighty  reasons  in  favor  of  such 
investigation,  one  of  which  is  suggested  by  the  fact  that 
the  Maritime  Canal  Company  of  Nicaragua  has  made 


2 


vigorous  efforts  both  in  this  country  and  in  Europe  to 
raise  the  necessary  funds  to  construct  the  canal,  but 
has  failed  in  all  such  efforts,  while  thousands  of  millions 
of  dollars  are  seeking  investment  in  profitable  under- 
takings. The  cause  of  this  failure  is  that  it  is  impos- 
sible to  adduce  evidence  that  the  canal  would  pay  even 
its  operating  expenses.  In  a word  the  Maritime  Canal 
Company  of  Nicaragua  is  bankrupt,  its  franchise  and 
property  are  of  doubtful  value,  and  its  practicability 
as  a commercial  enterprise  is  discredited. 

The  assertion  that  the  Government  must  furnish  the 
money  to  build  the  Nicaragua  Canal  because  it  is  too 
large  an  undertaking  for  private  capital  is  one  of 
the  shallowest  of  all  the  stories  with  which  Nica- 
ragua Canal  proponents  have  misled  the  people 
of  this  country.  The  truth  is  that  the  Canal  Com- 
pany engaged  in  the  construction  of  the  canal  as  a 
commercial  enterprise  and  utterly  failed.  A vigorous 
effort  was  made  to  induce  the  late  Colonel  North — the 
famous  “ Nitrate  King” — to  undertake  the  work.  He 
was  at  first  pleased  with  the  enterprise  and  said  some- 
thing in  its  favor,  but  upon  careful  examination 
found  it  to  be  a worthless  scheme  and  abandoned  all 
thought  of  investing  in  it. 

GEOGRAPHIC,  ECONOMIC  AND  COMMERCIAL 
REASONS  IN  FAVOR  OF  INVESTIGATION. 

The  geographic,  economic  and  commercial  reasons  in 
favor  of  such  an  investigation  as  I have  suggested  are 
also  cogent  and  unquestionable.  These  I presented 
somewhat  in  detail  in  an  article  which  appeared  in  the 
Engineering  Magazine  for  August,  1898.  A brief  allu- 
sion to  such  reasons  must  therefore  suffice  in  this  con- 
nection. 

The  superintendent  of  the  United  States  Coast  and 


3 


Geodetic  Survey  has  informed  me  that  the  distance 
from  New  York  to  Manila  is  181  miles  less  by  the  way 
of  the  Suez  Canal  than  by  the  way  of  the  Nicaragua 
Canal,  and  that  the  distance  from  London  to  Manila  is 
5,080  miles  less  by  the  way  of  the  Suez  Canal  than  by 
the  way  of  the  Nicaragua  Canal. 

There  are  other  considerations  in  proof  of  the  fact 
that  the  Suez  Canal  has  completely  eliminated  any  as- 
sumed necessity  for  the  construction  of  the  Nicaragua 
Canal  in  so  far  as  relates  to  the  commerce  of  Asia  and 
Australasia  with  Europe  and  the  Atlantic  ports  of  the 
United  States.  The  first  of  these  is  that  the  coaling 
facilities  of  the  Suez  route  are  greatly  superior  to  those 
of  the  Nicaragua  route.  Coal  has  become  a vital  con- 
dition of  oceanic  commerce.  A second  consideration  is 
that  the  Suez  Canal  is  a sea-level  canal,  whereas  the 
Nicaragua  Canal  involves  220  feet  of  lockage.  A third 
consideration,  not  the  least  important,  is  that  the  route 
from  Asiatic  ports  to  both  London  and  New  York  via 
Suez  Canal  offers  the  important  advantages  of  trade  at 
intermediary  commercial  ports,  whereas  such  advan- 
tages attach  in  an  inconsiderable  degree  to  the  Nicara- 
gua route.  A thorough  and  impartial  economic  and 
commercial  investigation  such  as  I have  repeatedly  rec- 
ommended and  now  urge,  would  reveal  approximately 
the  value  of  each  one  of  these  points  of  superiority  in 
terms  of  nautical  miles.  I estimate  that  in  the  aggre- 
gate they  amount  to  at  least  two  thousand  miles  in 
favor  of  the  Suez  route  for  trade  between  Manila  and 
New  York,  and  to  seven  thousand  miles  in  favor  of  the 
Suez  route  between  Manila  and  London.  A glance  at 
the  terrestrial  globe  clearly  indicates  that  for  the  rea- 
sons thus  stated  the  Nicaragua  route  could  never  be- 
come a competitor  of  the  Suez  Canal  route  for  the  trade 
of  Europe  and  the  eastern  side  of  North  America 
with  Asia  and  Australasia. 


I 


4 

Iq  this  connection  I would  allude  to  the  fact  that  the 
commerce  of  Asia  with  the  United  States  constitutes 
only  7i  per  cent  of  our  total  foreign  commerce,  and 
that  the  commerce  of  Australia  with  the  United  States 
constitutes  only  about  one  per  cent  of  our  total  foreign 
commerce.  Our  commerce  with  Asia  and  with  Austral- 
asia are  also  quite  small  in  comparison  with  our  com- 
merce with  Europe  and  even  with  Great  Britain.  This 
fact  is  exhibited  in  Appendix  B. 

The  question  as  to  whether  under  existing  conditions 
our  commerce  with  Asia  or  with  Australia  is  likely  to 
increase  largely  is  one  of  the  inquiries  which  should  be 
submitted  to  thorough  and  impartial  official  investiga- 
tion. Any  such  increase  will  not  in  any  degree  be  due 
to  the  construction  of  the  Nicaragua  Canal  for  reasons 
already  stated. 

The  commerce  of  the  Pacific  Coast  ports  of  the  United 
States  with  Asia  and  Australasia  will  not  of  course  in- 
volve the  use  of  any  canal.  Our  commerce  with  the 
Hawaiian  Islands  will  for  all  time  be  carried  on  through 
Pacific  Coast  ports,  and  the  entire  transcontinental  traf- 
fic of  the  United  States  will  move  almost  exclusively  by 
rail.  This  is  inevitable  from  the  force  of  overpowering 
geographical,  economic  and  commercial  conditions  which 
I will  explain.  The  center  of  population  in  the  United 
States  is  a little  east  of  the  meridian  of  Indianapolis. 
Two-thirds  of  the  people  of  this  country  reside  west  of 
the  Appalachian  range.  Evidently  therefore  the  com- 
merce of  the  Pacific  Coast  States  with  the  great  interior 
of  the  country  will  never  move  from  interior  points  in 
the  Pacific  Coast  States  to  Pacific  Coast  ports,  thence 
by  sea  through  the  Nicaragua  Canal  to  Atlantic  and 
Gulf  ports  and  thence  west  by  rail  to  points  of  destina- 
tion, or  vice  versa.  It  is  also  an  economic  fact  beyond 
all  question  that  the  transcontinental  railroads  and  their 


5 


eastern  connections  will  for  all  time  secure  the  entire 
transcontinental  carriage  of  passengers,  the  mails,  bul- 
lion, express  goods,  commodities  of  great  value,  perish- 
able articles,  and  goods  which  demand  quick  transit. 
This  would  leave  to  the  Nicaragua  Canal  route  only  a 
residuum  of  low-priced  freights,  for  which  also  the  rail 
lines  would  contest  vigorously.  If  the  Suez  Canal  route 
were  paralleled  even  by  one  railroad  competing  with  it 
as  sharply  as  would  each  one  of  the  six  transcontinental 
railroads  of  the  United  States  with  the  Nicaragua  Canal, 
the  former  route  would  at  once  lose  three-fourths  of  its 
income  from  traffic.  There  are  now  thirteen  transcon- 
tinental railroads  completed,  in  course  of  construction 
or  projected  between  Chili  and  Canada.  Each  one  of 
these  railroads  would  become  an  active  competitor  of 
the  Nicaragua  Canal  upon  its  completion. 

The  economic  fact  of  governing  force  in  this  whole 
matter  is  that  to-day  the  locomotive  engine  with  its 
train  of  cars  on  a steel  rail  is  the  most  efficient  instru- 
ment of  commerce  on  the  globe,  having  in  view  the 
conditions  of  speed,  cost  of  transportation  and  facilities 
for  the  collection  and  distribution  of  freights.  Practi- 
cal illustrations  of  this  fact  are  abundant.  The  year 
before  the  Union  and  Central  Pacific  railroads  line  was 
completed  the  value  of  the  freights  transported  between 
New  York  and  San  Francisco  via  Panama  was  $70,202,- 
029.  The  next  year  it  fell  to  $18,594,255,  and  during  the 
year  1894  it  had  fallen  to  only  $3,517,582.  Commerce 
between  New  York  and  San  Francisco  via  Panama  and 
via  Cape  Horn  has  almost  disappeared  in  the  face  of 
railroad  competition.  The  results  of  such  competition 
are  summarily  stated  in  the  following  carefully  compiled 
statement  of  tonnage  of  strictly  transcontinental  rail- 
road freight  and  of  freights  carried  between  California 


6 


and  the  Atlantic  Seaboard  by  the  Panama  Railroad 
route  and  the  Cape  Horn  route  during  the  year  1897. 

Tons. 

Transcontinental  railroad  traffic  . . . , 1,931,850 
Traffic  via  Panama  and  Cape  Horn  . . . 160,391 

For  the  general  purposes  of  commerce  to-day  one 
transcontinental  railroad  is  worth  a dozen  isthmian  ca- 
nals. Disregard  of  this  indisputable  economic  fact 
will  surely  bring  discredit  upon  this  nation  in  the  eyes 
of  all  the  world. 

Mr.  Miller  repeats  the  oft-asserted  declaration  that 
the  Nicaragua  Canal  would  save  10,753  miles  of  dis- 
tance over  the  Cape  Horn  route.  But  the  above  state- 
ment proves  that  there  is  very  little  left  out  of  the  for- 
mer Cape  Horn  traffic  between  the  Atlantic  and  Pacific 
Coasts  of  the  United  States  to  be  saved.  The  traffic 
between  the  two  coasts  by  the  Panama  Railroad  route 
has  also  become  practically  a thing  of  the  historic  past. 
The  great  bulk  of  such  traffic  has  been  captured  by  the 
transcontinental  railroads.  What  remains  of  the  Cape 
Horn  traffic  of  the  Pacific  Coast  is  carried  in  sailing 
vessels,  and  for  reasons  hereinafter  stated  would  not 
be  available  for  the  Nicaragua  Canal. 

There  is  no  commerce  on  the  Pacific  Coast  which 
would  contribute  materially  to  the  traffic  of  the  Nica- 
ragua Canal  from  San  Diego,  California,  to  Callao,  Peru. 
The  western  is  the  non-commercial  side  of  the  Ameri- 
can continent,  owing  to  the  fact  that  the  dividing  ridge 
of  the  continent  is  adjacent  to  its  western  coast  and  to 
the  additional  fact  that  a large  part  of  that  coast  is  arid. 
The  commerce  of  ports  of  South  America  south  of  Cal- 
lao consists  largely  of  sailing  vessel  cargoes,  and,  as 
already  stated,  the  Nicaragua  Canal  will  never  be  avail- 
able for  the  passage  of  sailing  vessels.  The  steam  nav- 
igation of  the  western  coast  of  South  America  south  of 


7 


Peru  with  Europe  and  the  Atlantic  seaboard  of  the 
United  States  will  continue  to  pursue  the  -route  through 
the  Straits  of  Magellan  for  the  reason  that  it  is  largely- 
sustained  by  intermediary  trade  at  ports  on  the  eastern 
coast  of  South  America. 

The  facts  of  importance  which  distinguish  the  Suez 
Canal  from  the  Nicaragua  Canal  are  that  the  former  con- 
nects great  commercial  nations  by  a direct  line  without 
railroad  competition,  whereas  the  latter  connects  two 
vast,  unproductive  oceans,  is  not  on  the  direct  line  of 
any  important  commercial  movement,  and  has  already 
seven  powerful  transcontinental  railroad  competitors. 

In  his  article  in  the  Forum  for  November  Mr.  Miller 
reiterates  the  oft-repeated  assertion  that  the  Nicaragua 
Canal  would  secure  an  enormous  traffic  from  coal 
shipped  from  the  Atlantic  seaboard  to  the  Pacific  Coast, 
from  cotton  and  cotton  goods  exported  from  our  Atlan- 
tic and  Gulf  States  to  China  and  Japan,  and  from  lum- 
ber shipped  from  the  Pacific  Coast  States  to  the  eastern 
side  of  the  continent,  but  he  makes  no  attempt  what- 
ever to  sustain  his  views  by  data  as  to  the  relative  cost 
of  transportation  by  rival  routes  or  the  effect  of  the 
competition  of  industries  and  markets  in  different  parts 
of  the  globe  upon  such  predicted  commercial  move- 
ments. I have  reliable  data  absolutely  disproving 
these  assumptions.  Coal  is  now  supplied  to  the  Pacific 
Coast  under  conditions  involving  many  related  trade 
movements  which  render  it  altogether  improbable  that 
it  could  be  shipped  at  a profit  through  the  Nicaragua 
Canal  except  as  return  cargo,  inconsiderable  in  amount. 
If  cotton  shall  in  the  future  be  shipped  in  large  quanti- 
ties to  China  and  Japan  it  will  undoubtedly  be  shipped 
from  Texas  and  other  Southern  States  to  Pacific  Coast 
ports  by  rail  and  thence  to  destination  by  steamer  at 
lower  rates  than  can  be  afforded  by  the  Nicaragua  Canal 


8 


route.  Under  existing  conditions  it  would  be  imprac- 
ticable fo  ship  lumber  from  the  Pacific  Coast  States  by 
Nicaragua  Canal  to  the  Atlantic  seaboard  in  competi- 
tion with  the  lumber  supply  of  the  Atlantic  and  Gulf 
States  and  of  Canada.  Nor  does  it  require  any  figuring 
to  prove  that  lumber  shipped  from  the  Pacific  Coast 
States  to  the  States  and  parts  of  States  west  of  the  me- 
ridian of  Indianapolis  will  in  the  future  as  now  move  over 
direct  rail  lines  from  points  of  production  to  points  of 
consumption  instead  of  being  shipped  from  points 
of  production  to  Pacific  Coast  ports,  thence  by  vessel 
via  Nicaragua  route  to  Atlantic  or  Gulf  ports,  and  thence 
by  rail  to  points  of  consumption.  At  the  present  time 
there  are  about  300,000  tons  of  lumber  and  shingles 
shipped  east  of  the  Rocky  Mountains  annually  from  the 
Pacific  Coast.  This  is  a growing  traffic. 

In  view  of  all  these  facts  my  careful  studies  of  the 
economic  and  commercial  aspects  of  the  Nicaragua  Canal 
project  have  convinced  me  that  it  would  be  impotent  as 
a competitor  of  the  transcontinental  railroads,  and  that 
on  the  other  hand  the  transcontinental  railroads  by  their 
efficiency  as  carriers  would  wipe  the  Nicaragua  Canal 
out  of  existence  as  a highway  of  commerce. 

All  questioning  about  the  future  course  of  the  com- 
mercial movements  just  mentioned  would  disappear  as 
the  result  of  a thorough  and  impartial  official  investiga- 
tion, such  as  that  herein  recommended. 

THE  ASSUMED  REGULATING  INFLUENCE  OF 
THE  NICARAGUA  CANAL. 

One  of  the  reasons  advanced  in  favor  of  the  con- 
struction of  the  Nicaragua  Canal  is  that  it  would 
regulate  transcontinental  rail  rates,  even  if  it  secured 
no  traffic.  This  is  asserted  as  an  economic  dogma  of 
general  application  regarding  competition  between  rail 


9 


lines  and  water  lines.  But  no  such  rule  obtains.  It  is 
true  that  in  many  instances  water  lines  regulate  rail 
lines,  and  it  is  also  true  that  in  many,  and  important 
instances  no  effective  regulating  influence  is  exerted 
over  railroads  by  water  lines,  even  by  the  ocean.  The 
competition  of  railroads  on  the  other  hand  has  in  innu- 
merable instances  not  only  regulated  rates  on  water  lines 
but  has  greatly  reduced  and  in  many  instances  destroyed 
the  traffic  of  water  lines.  Many  canals  in  this  country 
have  been  completely  wiped  out  of  existence  by  com- 
peting railroads.  In  all  parts  of  the  country  the  traffic 
of  rivers  has  been  greatly  reduced  and  radically 
changed  in  character  by  the  competition  of  railroads. 

In  this  connection  I would  mention  an  exceedingly 
important  inquiry  which  demands  the  special  attention 
of  Congress,  viz  : How  far  is  the  Government  justified 
in  building  a competing  line  for  the  purpose  of  regu- 
lating the  cost  of  transportation  on  other  lines  built 
either  by  public  or  private  capital  ? The  question  is  one 
of  limitations  and  not  of  principle.  Evidently  if  such 
a competing  line  would  not  pay  enough,  at  a very 
moderate  rate  of  tolls,  to  meet  even  its  operating  expenses 
exclusive  of  any  interest  whatever  upon  the  cost  of  the 
line,  it  would  be  in  the  nature  of  an  unjustifiable 
bounty  or  subvention  in  favor  of  particular  shippers. 
Its  construction  in  such  case  would  constitute  the 
taking  of  money  out  of  the  pockets  of  certain  citizens 
in  order  to  confer  a benefit  of  much  less  value  upon 
others.  This  is  anti-American,  it  is  imperialistic,  it  is 
impolitic  and  it  is  unjust.  I believe  that  a thorough 
and  impartial  official  investigation,  such  as  I propose, 
will  clearly  reveal  the  fact  that  the  Nicaragua  Canal 
will  not  pay  its  operating  expenses.  Under  such  cir- 
cumstances its  construction  by  the  Government  would 
be  a reprehensible  form  of  paternalism.  It  would  also 


10 


be  an  outrageous  raid  upon  the  public  treasury.  I ask 
for  these  propositions  a thorough  and  impartial  investi- 
gation. 

THE  NICARAGUA  CANAL  UNAVAILABLE  FOR 
SAILING  VESSELS. 

Like  the  Suez  Canal,  the  Nicaragua  Canal  would  be 
totally  unavailable  for  the  passage  of  sailing  vessels  on 
account  of  lack  of  wind.  Upon  this  subject  that  re- 
nowned authority  on  physical  geography,  Lieutenant 
Maury,  of  the  United  States  Navy,  wrote  as  follows  : 

“If  nature,  by  one  of  her  convulsions,  should  rend 
the  continent  of  America  in  twain  and  make  a channel 
across  the  Isthmus  of  Panama  or  Darien,  as  deep,  as 
wide  and  as  free  as  the  Straits  of  Dover,  it  would 
never  become  a commercial  thoroughfare  for  sailing 
vessels,  saving  the  outward  bound  and  those  which 
could  reach  it  with  leading  winds.” 

The  cost  of  towing  sailing  vessels  to  and  from  the 
Nicaragua  Canal  and  through  it,  in  connection  with 
canal  tolls,  would  greatly  exceed  the  cost  of  navigating 
vessels  around  Cape  Horn.  That  the  Nicaragua  Canal 
would  be  unavailable  for  sailing  vessels  is  also  proved 
by  the  fact  stated  by  the  Board  of  Engineers  of  1895 
that  the  rainfall  on  the  eastern  coast  of  Nicaragua 
amounts  to  nearly  twenty-five  feet  a year. 

The  proponents  of  the  Nicaragua  Canal  base  their 
arguments  largely  upon  the  assumption  that  sailing 
vessels  are  going  out  of  use.  This  is  a mistake.  The 
sailing  tonnage  of  the  United  States  on  June  30,  1897, 
was  greater  than  at  the  end  of  the  previous  fiscal  year. 
Besides,  the  sailing  tonnage  built  in  the  United  States 
has  exhibited  an  increase  during  the  last  four  years. 
A few  months  ago  a prominent  shipbuilder  of  the  State 
of  Maine  stated  to  me  that  he  had  recently  built  a steel 
sailing  vessel  of  about  3,000  tons,  and  declared  his 


11 


belief  that  this  ship  will,  barring  accidents,  last  fifty 
years,  and  be  one  of  the  best  paying  pieces  of  property 
which  he  shall  leave  to  his  children. 

There  is  an  element  in  the  cost  of  transportation  upon 
the  sea  which  is  lost  sight  of  by  persons  who  would 
relegate  sailing  vessels  to  the  dead  past,  and  that  is  the 
element  of  storage.  From  time  immemorial  there  has 
been  a tendency  on  the  part  of  shippers  to  use  vehicles 
of  commerce  as  warehouses.  This  is  strongly  mani- 
fested not  only  in  the  use  of  sea-going  vessels  but  even 
on  railroads.  This  privilege  is  of  value  to  shippers  and 
the  granting  of  it  becomes  a subject  for  compensation 
to  the  owners  of  vehicles  of  commerce  under  the 
designation  of  demurrage.  It  frequently  happens  in 
ocean  commerce  that  the  slow  ship  is  a more  desirable 
vehicle  of  transportation  than  the  fast  ship.  This  is 
particularly  the  case  with  respect  to  commodities  which 
come  to  maturity  and  are  marketable  within  the  space 
of  a few  weeks  but  are  required  for  the  world’s  con- 
sumption during  the  entire  year.  Wheat  becomes 
marketable  within  the  space  of  about  six  weeks,  but  a 
large  part  of  it  must  be  held  in  store  somewhere  during 
the  entire  year  in  order  to  meet  the  continuing  demand 
for  bread.  Therefore  the  slow  sailing  vessel  is  fre- 
quently a more  desirable  vehicle  of  commerce  than  the 
swift  steamer.  The  commodities  which  seek  transpor- 
tation on  sailing  vessels  are  those  which  are  moved  in 
large  quantities  and  in  shiploads.  They  are  principally 
the  cereals,  cotton,  coffee,  coal,  ice,  ores  and  other 
minerals. 

In  the  investigation  which  is  to  determine  the  com- 
mercial value  of  the  Nicaragua  route,  the  question  as 
to  how  much  of  the  commerce  of  the  western  coast  of 
North  America  and  of  South  America  will  continue  to 
move  in  sailing  vessels  constitutes  an  important  inquiry. 


12 


From  the  foregoing  it  appears  that  the  Nicaragua 
Canal  is  a project  based  upon  conditions  which  pre- 
vailed fifty  years  ago  but  have  long  since  been 
remitted  to  the  mouldy  past. 

I bespeak  for  this  whole  subject  a thorough  and  im- 
partial investigation.  The  proponents  of  the  Nicaragua 
Canal  oppose  such  inquiry. 

NICARAGUA  CANAL  LOBBYING. 

Mr.  Miller  declares  in  his  Forum  article  that  a pow- 
erful lobby  in  the  interest  of  transcontinental  railroads 
has  for  years  been  maintained  in  Washington  for  the 
purpose  of  opposing  the  Nicaragua  Canal  project.  I 
believe  this  to  be  incorrect.  For  thirty-three  years  I have 
spent  a large  part  of  each  year  at  my  place  of  residence 
in  Washington.  If  any  such  lobby  influence  had  ex- 
isted there  it  would  probably  have  come  to  my  notice 
through  the  ordinary  channels  of  public  information. 
I have  no  knowledge  of  its  existence. 

But  how  has  it  been  on  the  other  side  ? Mr.  Miller’s 
oft-repeated  declaration  about  a powerful  railroad  lobby 
at  Washington  clearly  implies  that  there  must  have 
been  some  powerful  counter-influence  to  oppose  before 
Congress.  This,  however,  is  not  left  to  implication. 
It  is  a fact  known  to  every  Senator  and  Member  of  Con- 
gress and  to  all  the  representatives  of  the  public  press 
in  Washington  that  for  nearly  ten  years  a persist- 
ent and  importunate  Nicaragua  Canal  lobby  has 
besieged  the  committee  rooms  and  the  corridors 
of  the  Capitol  at  Washington. 

Lobbying  at  Washington  has,  however,  been  only 
one  phase  of  the  efforts  of  the  proponents  of  the  Nica- 
ragua Canal  project.  During  the  last  twenty  years, 
and  particularly  during  the  last  ten  years  proponents 
of  the  Maritime  Canal  Company  of  Nicaragua  have 


13 


conducted  a propaganda  throughout  this  country,  in- 
volving the  object  of  drawing  an  enormous  amount  of 
money  out  of  the  national  treasury.  The  main  object  in 
the  conduct  of  this  propaganda  has  been  to  secure  popu- 
lar belief  in  the  importance  of  the  enterprise,  at  the 
same  time  avoiding  any  governmental  investigation  as 
to  the  correctness  of  their  statements. 

Another  feature  of  the  Nicaragua  Canal  propaganda 
has  been  that  of  influencing  State  and  national  political 
conventions. 

Mr.  Warner  Miller  declared  before  the  Conference  on 
Territorial  Expansion,  which  assembled  at  Saratoga 
Springs  on  the  17th  of  August  last,  that  in  the  advocacy 
of  the  Nicaragua  Canal  enterprise  he  has  twice  traversed 
the  entire  country. 

An  impartial  governmental  investigation  as  to  the 
manner  in  which  and  the  expedients  by  which  the 
Nicaragua  Canal  propaganda  has  been  conducted  would 
tend  to  throw  much  light  upon  the  present  status  of  the 
project  as  a public  question.  The  fact  that  proponents 
of  the  Nicaragua  Canal  shun  all  attempts  to  institute 
official  investigation  was  clearly  manifested  by  an  inci- 
dent which  occurred  in  the  year  1890.  After  certain 
of  the  principal  Nicaragua  Canal  propagandists  had 
traversed  the  entire  country  for  the  purpose  of  securing 
the  endorsement  of  boards  of  trade  and  chambers  of 
commerce  they  sent  a solicitous  request  to  the  influential 
Chamber  of  Commerce  of  New  York,  for  such  endorse- 
ment. This  request  was  accompanied  by  an  elaborate 
statistical  statement,  which  was  submitted  to  me  for 
criticism.  I found  it  to  be  a mere  statistical  juggle 
apparently  gotten  up  by  one  not  informed  as  to  the 
philosophical  use  of  statistical  data,  and  over-anxious  to 
prove  the  great  value  of  a chimera  with  which  he  was  in 
love.  In  presenting  my  criticism  I earnestly  requested 


14 


that  it  might  be  submitted  to  the  chief  officer  of  the  canal 
company  for  revision,  in  order  to  avoid  the  possibility 
of  giving  that  company  any  occasion  to  complain  of 
unfair  treatment.  My  statement  was,  however,  returned 
to  the  Chamber  of  Commerce  without  comment,  and 
that  body  has  never  yet  endorsed  the  Maritime  Canal 
of  Nicaragua. 

In  their  entire  propaganda  and  lobbying  work 
proponents  of  the  Nicaragua  Canal  scheme  seem  to 
have  proceeded  upon  the  theory  of  Aaron  Burr’s  defini- 
tion of  sound  law,  “ whatever  is  boldly  asserted  and 
plausibly  maintained.” 

THE  ORIGIN  AND  GROWTH  OF  THE  NICARAGUA 
CANAL  CHIMERA. 

The  degree  of  public  favor  which  the  Nicaragua  Canal 
project  has  secured  in  advance  of  any  thorough  and  im- 
partial official  investigation  as  to  its  merits  is  astounding. 
We  live  in  an  age  of  economic  inquiry.  The  question 
“ will  it  pay”  is  the  touchstone  of  commercial  and  in- 
dustrial enterprise.  Nevertheless,  the  public  discussions 
of  the  Nicaragua  Canal  project  have  related  almost  ex- 
clusively to  its  historical,  political,  geographical  and 
engineering  aspects,  omitting  any  careful  consideration 
of  the  commercial  and  economic  conditions  involved. 
Consequently,  the  popular  view  of  the  Nicaragua  Canal 
enterprise  has  become  picturesque  rather  than  practical. 
The  degree  of  success  which  has  attended  the  scheme 
seems  to  be  due  to  the  fact  that  it  was  conceived  by 
certain  distinguished  gentlemen  whose  first  ideas  upon 
the  subject  were  formed  exclusively  upon  the  basis  of 
historical  and  geographical  considerations.  Thus  they 
formed  a picture  of  the  enterprise  in  their  own  minds. 
Everything  which  threw  light  upon  this  picture  was 


15 


then  pleasing  to  them  and  everything  which  cast  a 
shadow  upon  it  was  offensive.  In  this  state  of  mind 
they  were  in  no  condition  to  subject  their  scheme  to  the 
hard  tests  of  economic  and  commercial  inquiry,  and 
they  had  sufficient  political  and  official  influence  to  lead 
the  general  public  and  legislators  to  accept  their  con- 
clusions without  investigation. 

THE  HISTORY  OF  ESTIMATES  AS  TO  THE 
COMMERCIAL  VALUE  OF  AMERICAN  ISTH- 
MIAN CANALS. 

When  de  Lesseps  came  to  this  country  in  the  year 
1880,  he  submitted  his  estimate  of  the  cost  of  the 
Panama  Canal  and  his  estimates  of  tonnage  which 
would  pass  through  it  to  the  American  Society  of  Civil 
Engineers.  That  organization  found  his  estimate  of 
cost  to  be  grossly  in  error.  Certain  of  its  members  also 
found  that  his  estimate  of  six  million  tons  of  shipping 
annually  was  made  up  by  including  vessels  which 
would  have  to  go  from  three  to  five  thousand  miles  out 
of  the  shortest  route  in  order  to  pass  through  the 
Panama  Canal.  The  society  then  asked  me,  in  my 
official  capacity  as  Chief  of  the  Bureau  of  Statistics  of 
the  Treasury  Department  at  Washington,  to  compute 
the  amount  of  tonnage  likely  to  pass  through  it.  This 
I did  with  great  care  and  as  the  result  of  my  inquiry 
found  that  the  extreme  limit  of  its  commercial  possibili- 
ties was  about  1,625,000  tons  annually.  In  a word,  I 
found  the  de  Lesseps  estimate  of  tonnage  to  be  as  false 
as  those  financial  statements,  which  ultimately  caused 
some  of  the  chief  proponents  of  the  Panama  Canal 
scheme  to  find  their  way  to  the  inside  of  French  prisons. 

My  official  report  of  Panama  tonnage  made  in  1880 
was  regarded  as  a practical  condemnation  of  any  and 
all  American  isthmian  canal  projects  from  Tehuantepec 


16 


to  Darien.  It  was  based  upon  the  same  economic  and 
commercial  considerations  which  I entertain  to-day. 
The  Maritime  Canal  Company  of  Nicaragua  was  organ- 
ized nine  years  later  by  Act  of  Congress  approved  Feb- 
ruary 20,  1889.  Instead  of  first  testing  the  accuracy  of 
my  report  by  reference  to  official  data — a thing  which 
the  Nicaragua  Canal  proponents  have  studiously 
avoided — they  adopted  the  exploded  de  Lesseps  estimate 
of  tonnage.*  One  and  another  of  them  has,  however,  put 
forth  estimates  of  tonnage,  mere  guesses  widely  differ- 
ing, but  producing  an  average  which  the  Maritime 
Canal  Company  has  adopted  as  the  true  estimate  to  be 
accepted  by  the  Congress  and  the  people  of  the  United 
States  without  question  or  official  inquiry  of  any  sort. 
Three  years  ago  I carefully  revised  my  official  report 
of  1880  and  found  that  instead  of  1,625,000  tons,  as 
therein  stated,  the  possible  annual  tonnage  of  any 
American  isthmian  canal  must  be  reduced  to  about 
800,000  tons  annually  in  consequence  of  the  great  re- 
duction in  transcontinental  rates  and  other  changed 
conditions.  The  Secretary  of  Agriculture  has  recently 
reported  that  the  average  rail  rate  between  New  York 
and  San  Francisco  in  1897  was  less  than  one-third  the 
rate  in  1870. 

Surely  it  is  high  time  for  the  Congress  of  the  United 
States  to  institute  a thorough  and  impartial  investiga- 
tion as  to  the  commercial  merits  of  the  Nicaragua 
Canal  and  to  postpone  any  consideration  as  to  appro- 
priating money  for  its  construction  in  advance  of  such 
investigation.  I plead  for  such  investigation,  confident 
that  it  will  verify  my  conclusions  of  1880  and  1895. 
The  proponents  of  the  Nicaragua  Canal  oppose  such  in- 
vestigation and,  as  I believe,  from  fear  that  it  would 
be  fatal  to  their  scheme. 


* This  varied  from  six  to  nine  million  tons. 


17 


CHANGE  OF  PUBLIC  SENTIMENT  IN  REGARD 
TO  THE  NICARAGUA  CANAL  PROJECT. 

During  the  last  six  months  the  tone  of  the  public 
press  has  changed  in  regard  to  the  proposition  that  the 
Government  of  the  United  States  shall  construct  the 
Nicaragua  Canal  in  advance  of  any  thorough  and  im- 
partial official  investigation  as  to  its  commercial  and 
military  aspects  I infer  this  somewhat  from  my  per- 
sonal experiences  in  regard  to  the  subject.  In  the  July 
number  of  the  Engineering  Magazine , published  simul- 
taneously in  New  York  and  in  London,  Professor  Haupt, 
a member  of  the  present  Nicaragua  Canal  Board,  pub- 
lished an  article  on  the  importance  of  constructing  the 
Nicaragua  Canal  from  the  commercial  point  of  view. 
This  was  aside  from  his  official  duty  of  investigating 
the  engineering  features  of  the  scheme  and  seemed  to 
constitute  a distinct  departure  from  the  function  of 
judge  to  that  of  propagandist.  Ignoring  present  con- 
ditions, he  based  his  reasoning  entirely  upon  the  unofficial 
and  unauthenticated  statements  of  a certain  Mr.  F.  W. 
Kelly,  of  New  York,  which  statements  were  founded 
upon  statistics  for  the  years  1856-’57.  This  was  long 
before  the  Suez  Canal  or  any  one  of  the  transcontinental 
railroads  had  been  constructed.  At  the  request  of  the 
editor  of  the  Engineering  Magazine  I replied  to  the 
article  of  Professor  Haupt  in  the  issue  of  that  magazine 
of  August  last.  In  this  article  I. showed,  from  present 
conditions,  that  the  Nicaragua  Canal  is  devoid  of  any 
considerable  commercial  merits  and  that  its  assumed 
military  importance  is  conjectural.  In  the  October 
number  of  the  Engineering  Magazine  the  professor  has 
a fanciful  and  inconsequential  reply  to  my  article,  in 
which  he  indulges  in  such  poetic  expressions  as  “the 
desires  of  centuries  to  unravel  the  secret  of  the  Straits,” 
without  stating  to  what  particular  desires  or  centuries 


18 


or  secret  or  straits  he  has  reference.  Besides,  the 
professor  has  utterly  failed  before  the  forum  to  which 
he  has  appealed,  for  in  introducing  his  rejoinder  the 
editor  of  the  Engineering  Magazine  states  that  “the 
attitude  of  the  magazine’’  is  “one  of  dissatisfaction 
with  the  evidence  so  far  offered  as  to  the  engineering 
feasibility  of  the  scheme  advanced,  skepticism  as  to  the 
commercial  advantages  of  the  canal  and  strong  opposi- 
tion to  the  governmental  espousal  of  the  undertaking.” 

I believe  this  voices  the  prevailing  sentiment  of  the 
engineering  profession  in  regard  to  the  Nicaragua  Canal 
scheme  both  in  this  country  and  in  Great  Britain. 

The  Conference  on  Territorial  Expansion,  held  at 
Saratoga  Springs,  N.  Y.,  on  August  19  last,  consid- 
ered the  Nicaragua  Canal  question.  Hon.  Warner 
Miller  spoke  in  favor  of  the  project.  I followed,  being 
also  a member  of  the  conference,  directing  my  argu- 
ment particularly  to  the  importance  of  a thorough  and 
impartial  investigation  of  the  commercial  and  military 
aspects  of  the  Nicaragua  Canal  project.  The  commit- 
tee on  resolutions,  composed  of  twenty-four  men  distin- 
guished for  ability,  did  not  present  any  resolution  in 
favor  of  the  canal  project,  as  had  been  expected  and 
hoped  for  by  the  canal  proponents. 

The  Committee  on  Platform  and  Resolutions  of  the 
Republican  State  Convention,  held  at  Saratoga  Springs, 
September  27,  1898,  considered  the  Nicaragua  Canal 
project,  and  for  the  first  time,  I think,  in  ten  years, 
omitted  any  reference  to  it  in  its  report  to  the  conven- 
tion. I was  a member  of  that  committee  and  conven- 
tion and  did  what  I could  to  expose  the  unworthiness  of 
the  scheme. 


19 


The  idea  that  the  Government  of  the  United  States 
ought  to  investigate  before  investing  in  the  Nicaragua 
Canal  scheme  seems  to  be  slowly  but  surely  securing 
conviction  in  the  public  mind. 

INVESTIGATIONS  AS  TO  THE  ENGINEERING 
ASPECTS  OF  THE  SCHEME. 

The  proponents  of  the  Nicaragua  Canal  were  as  much 
opposed  to  any  governmental  investigation  of  the  engi- 
neering features  of  their  scheme  as  they  are  now  op- 
posed to  any  investigation  as  to  its  commercial  and 
military  aspects.  But  after  awhile  public  suspicion 
was  aroused  as  to  the  estimates  of  cost  put  forth  by  the 
Canal  Company.  Accordingly  certain  Senators  and 
Members  of  Congress  resolved  to  institute  a govern- 
mental investigation.  This  was  accomplished  by  a pro- 
vision of  law  approved  January  28,  1895.  The  engi- 
neering commission  of  1895  was  composed  of  three  emi- 
nent engineers,  viz : General  William  Ludlow,  of  the 
United  States  Corps  of  Engineers,  who  lately  distin- 
guished himself  at  Santiago;  Commodore  M.  T.  Endi- 
cott,  a civil  engineer  of  the  Navy,  now  Chief  of  the 
Bureau  of  Yards  and  Docks  in  the  Navy  Department, 
and  Alfred  Noble,  a civil  engineer  of  Chicago.  The 
canal  company  had  no  voice  in  the  selection  of  these 
men.  The  report  of  the  commission  was  that  the  canal 
would  cost  $183,472,893,  as  against  an  estimated  cost 
of  $69,893,660  made  by  the  chief  engineer  of  the  canal 
company.  The  proponents  of  the  Nicaragua  Canal  op- 
posed the  resolution  creating  this  commission  and  de- 
clared that  it  was  framed  by  the  enemies  of  the  canal 
company.  When  the  report  of  the  commission  of  emi- 
nent engineers  was  submitted,  it  was  vigorously  at- 
tacked by  representatives  of  the  Maritime  Canal  Com- 
pany of  Nicaragua  before  the  Committee  on  Interstate 


20 


and  Foreign  Commerce  of  the  House  of  Representatives. 
These  men  not  only  challenged  the  professional  work  of 
the  commissioners,  but,  as  already  stated,  went  so  far  as 
to  impeach  their  integrity.  Although  unsuccessful  in 
these  efforts,  the  canal  propagandists,  have  been  suc- 
cessful in  having  created  another  engineering  com- 
mission composed  of  three  men  believed  to  be  entirely 
acceptable  to  the  wildest  advocate  of  the  Nicaragua 
Canal.  The  chairman  of  this  engineering  commission,  is 
not  an  engineer.  All  three  of  the  commissioners  are 
understood  to  be  advocates  of  the  canal.  They  have  al- 
ready appeared  before  the  Senate  Committee  on  the 
Nicaragua  Canal  and  there  expressed  their  full  faith  in 
the  project  several  months  in  advance  of  the  completion 
of  their  report.  As  before  stated,  one  member  of  this 
commission  came  before  the  public  in  an  article  pub- 
lished in  the  Engineering  Magazine  of  July,  1898,  in 
which  article  he  expressed  his  abiding  faith  in  the  canal 
project,  basing  his  opinion  upon  certain  unofficial,  un- 
authorized and  absurd  commercial  data  for  the  years 
1856  and  1857,  since  which  time  the  whole  course  and 
conditions  of  oceanic  commerce  have  been  radically 
changed. 

Mr.  Warner  Miller  has  also  mentioned  in  his  Forum 
article  another  evidence  of  the  previousness  of  this  com- 
mission. After  stating  the  fact  that  the  commission 
have  at  their  disposal  about  $300,000  appropriated 
by  Congress,  that  it  has  fifty  engineers  engaged 
on  the  surveys  and  computations  to  be  completed  in 
December  next,  he  also  states  that  last  June — six  months 
in  advance  of  the  completion  of  their  technical  work — 
the  three  commissioners  appeared  before  a Senate  com- 


21 


mittee  made  guesses  as  to  the  cost  of  the  work  as 
follows : 

Professor  Haupt $90,000,000 

Admiral  Walker 125,000,000 

General  Haines 140,000,000 

The  highest  of  these  guesses  is  forty  five  per  cent 
above  the  lowest.  This  is  a manifest  absurdity.  The 
commission  seems  to  have  been  unable  to  withstand  the 
exigencies  of  a popular  chimera. 

I plead  for  a thorough  and  impartial  official  investi- 
gation of  the  commercial  and  military  aspects  of  the 
Nicaragua  Canal,  under  order  of  Congress,  a legislative 
duty  already  too  loDg  delayed. 

LESSONS  OF  MODERN  FAILURES  IN  THE  CON- 
STRUCTION OF  SHIP  CANALS. 

Three  stupendous  blunders  have  been  made  by  en- 
lightened nations  during  the  last  twenty  years  in  the 
construction  of  ship  canals.  I refer  to  the  Manchester 
Canal  of  England,  the  Kiel  Canal  of  Germany,  and  the 
Corinth  Canal  of  Greece. 

The  main  facts  in  regard  to  the  Manchester  Canal  are 
clearly  set  forth  by  Hon.  Wm.  F.  Grinnell,  United 
States  Consul  at  Manchester,  in  the  admirable  volume 
published  by  the  Department  of  State,  entitled  “ Canals 
and  Irrigation  in  Foreign  Countries.”  Mr.  GrinnelPs 
dispatch,  which  is  dated  March  16,  1897,  clearly  expose^ 
the  lamentable  financial  results  of  the  construction  of 
the  Manchester  Canal.  The  estimated  cost  of  this  work 
was  $47,750,098,  but  the  actual  cost  was  $73,818,940. 
The  ship  tonnage  which  would  pass  through  the  canal 
annually  was  estimated  at  9,649,316  tons,  but  it 


22 


amounted  to  only  1,826,237  tons  during  the  year  1896, 
or  less  than  one-fourth  the  amount  estimated.  The  es- 
timated receipts  of  the  canal,  before  its  construction, 
was  $8,174,659,  but  the  revenue  from  tolls  in  1896 
amounted  to  only  $884,218,  or  less  than  one-ninth  the 
amount  estimated.  It  is  also  stated  that  “ the  ex- 
penditure on  ship  canal  revenue  account  during  the 
half-year  ending  June  30,  1896,  was  7,429  pounds  ster- 
ling ($35,956)  in  excess  of  the  receipts/’  So  it  appears 
that  in  England,  the  country  most  highly  distinguished 
in  modern  times  for  economic  and  commercial  sagacity, 
the  enormous  sum  of  nearly  $74,000,000  was  wasted  in 
the  construction  of  a canal  which  does  not  pay  its  run- 
ning expenses.  This  gigantic  blunder  was  due,  first, 
to  a failure  to  correctly  estimate  the  cost  of  construc- 
tion, and,  second,  to  the  failure  to  compute  even  ap- 
proximately the  amount  of  traffic  which  the  canal  would 
be  able  to  secure.  The  latter,  which  is  by  far  the  most 
serious  error,  as  shown  by  Consul  Grinnell,  was  due 
mainly  to  the  failure  to  estimate  the  effect  of  the  com- 
petition of  rival  railroads.  A far  more  appalling  result 
confronts  the  United  States  through  the  failure  to  make 
any  careful  computation  as  to  the  effect  of  the  compe- 
tition of  thirteen  rival  railroads  upon  the  traffic  of  the 
Nicaragua  Canal.  Such  neglect  would  now  be  inexcus- 
able for  the  reason  that  the  computation  can  be  made, 
not  with  precision  but  approximately.  Nor  has  there 
been  any  effort  to  ascertain  the  amount  of  traffic  tribu- 
tary to  the  canal  or  to  ascertain  the  attractive  force  of 
rival  lines.  Let  not  the  Government  of  this  great  and 
enlightened  nation  commit  itself  to  the  stupendous  folly 
of  failing  to  make  a proper  investigation  as  to  the  com- 
mercial and  economic  conditions  which  environ  the 
Nicaragua  Canal  before  entering  upon  its  construc- 
tion. In  a word,  let  it  investigate  before  investing. 


23 


CERTAIN  OTHER  FALLACIES. 

There  are  other  fallacies  which  have  heretofore  been 
used  with  great  effect  in  the  promotion  of  public  senti- 
ment in  favor  of  the  Nicaragua  Canal  scheme.  Certain 
of  these  may  be  mentioned: 

1.  The  assumption  that  the  success  of  the  Suez  Canal 
proves  that  the  Nicaragua  Canal  would  necessarily  be 
successful  is  negatived  by  the  single  fact  that  the  Suez 
Canal  has  no  railroad  competitor,  whereas  the  Nicaragua 
Canal,  as  already  shown,  would  at  the  beginning  be 
overwhelmed  by  the  competition  of  six  rival  railroad 
lines.  One  railroad  competing  with  the  Suez  Canal  as 
sharply  as  would  the  transcontinental  railroads  of  the 
United  States  with  any  possible  American  isthmian 
canal  would  at  once  take  from  it  (the  Suez  Canal)  the 
entire  passenger  traffic  and  the  carriage  of  all  the  mails, 
bullion,  express  goods  and  the  higher  classed  freights 
and  perishable  goods.  The  result  of  such  competition 
would  be  to  bankrupt  the  Suez  Canal  Company.  The 
most  striking  difference  between  the  Suez  Canal  and 
the  Nicaragua  Canal  is  that  the  former  connects  great 
commercial  countries  while  the  latter  connects  vast  un- 
productive oceans. 

2.  The  assumption  that  the  commerce  of  the  Sault 
Ste.  Marie  Canal  proves  that  the  Nicaragua  Canal  would 
be  successful  is  utterly  fallacious.  The  lake  commerce 
via  Sault  Ste.  Marie  is  in  the  nature  of  barge  transfer 
between  railroad  termini,  from  seven  to  nine  hundred 
miles  apart  in  the  carriage  of  enormous  quantities  of 
natural  products,  chiefly  grain,  ores  and  coal.  It  is  a 
traffic  which  has  no  parallel  on  the  globe. 

3.  The  assumption  that  the  Nicaragua  Canal  would 
be  of  benefit  to  Chicago  and  other  cities  of  the  West  is 
fallacious.  If  constructed  the  chief  function  of  the 
Nicaragua  Canal  would  be  to  divert  the  commerce  of 


24 


our  Pacific  Coast  from  the  railroads  which  bring  such 
trade  direct  to  the  distributing  centers  of  the  West, 
assuming  that  it  would  have  the  power  thus  to 
divert  traffic,  an  assumption  which  I strenuously  deny. 
Trade  which  would  pass  through  the  Nicaragua  Canal 
to  the  cities  on  the  Atlantic  seaboard  would  there  find 
distributing  markets  which  would  supersede  Chicago 
as  such.  Let  the  great  cities  of  the  West  think  again 
upon  this  subject,  and  think  reflectively. 

4.  The  assumption  that  the  Nicaragua  Canal  may  be 
of  benefit  to  the  people  of  the  Pacific  coast  with  respect 
to  the  large  trade  expected  to  be  developed  with  Hawaii, 
the  Philippine  Islands,  Japan  and  China  is  fallacious. 
All  of  that  trade  which  should  move  by  the  Nicaragua 
Canal  route  would  be  in  the  nature  of  a diversion  from 
San  Francisco  and  other  Pacific  coasts  of  this  country. 
This  is  indicated  by  the  fact  that  Honolulu,  the  chief 
coaling  station  between  Asia  and  North  America,  is  986 
nautical  or  1,142  statute  miles  south  of  the  latitude  of 
San  Francisco.  Every  time  a railroad  car  moves  it 
exerts  an  influence  toward  the  development  of  the 
country  through  which  it  passes,  and  toward  the  pros- 
perity of  the  commercial  towns  and  cities  whose  inter- 
ests it  subserves.  But  a ship  leaves  behind  it  no  evi- 
dence of  its  passage  upon  the  pathless  sea.  It  would 
seem  that  one  foreign  transportation  line  at  the  north 
of  San  Francisco  drawing  from  that  city  a large  amount 
of  Asiatic  commerce  ought  to  suffice.  Let  the  people 
of  the  Pacific  coast  think  again  upon  this  subject,  and 
think  reflectively. 

THE  MILITARY  ASPECTS  OF  THE  PROPOSED 
NICARAGUA  CANAL. 

Much  has  been  said  in  regard  to  the  importance  of 
the  Nicaragua  Canal  as  a passageway  for  the  war-ships 


26 


of  the  American  Navy,  both  in  time  of  peace  and  of 
war.  This  assumption  does  not  bear  the  test  of  scrutiny. 
It  is  negatived  already  by  official  reports  of  officers  of 
the  Army  and  the  Navy  who  have  given  to  the  subject 
careful  investigation  and  mature  reflection.  For  ex- 
ample : 

1.  In  an  official  “ Report  on  the  Nicaragua  Canal  in 
its  Military  Aspects/'  made  by  Capt.  George  P.  Scriven 
of  the  U.  S.  Army  to  Brig.  Gen.  A.  W.  Greely,  Chief 
Signal  Officer,  in  the  year  1894,  only  four  years  ago,  it 
is  declared  that  “ actual  defenses  must  be  provided  by 
the  United  States  both  for  external  and  internal  protec- 
tion. ” and  that  ‘‘the  canal  must  be  guarded  at  every 
vital  point  and  carefully  watched  throughout. ” Capt. 
Scriven  also  explains  the  necessity  for  forts  and  naval 
vessels  at  either  end.  Upon  this  subject  he  quotes 
approvingly  from  Lieut.  L.  D.  Green,  of  the  U.  S.  Army, 
as  follows : 

“To  practically  defend  the  canal  we  would  require  heavy  sea  batteries 
at  its  ocean  extremities  armed  with  guns  of  equal  power  to  those  carried 
by  first-class  battleships. 

“In  the  seacoast  batteries  will  be  habitually  kept  sufficient  garrisons  to 
guard  and  cave  for  the  property  and  guns,  while  the  main  military  force 
can  be  massed  at  one  or  two  central  points  upon  the  healthful  and  breezy 
uplands,  wuence  the  seacoast  garrisons  could  be  changed  by  periodical 
details,  the  whole  or  any  part  of  the  command  ready  to  move  to  either 
the  east  or  west  coast,  as  required,  at  a day’s  notice.’’ 

Gen  Greely  adds  to  Capt.  Scriven’s  report  a valuable 
appendix  in  which  he  cites  authorities  in  regard  to  the 
difficulties  of  military  operations  in  Nicaragua  from 
climatic  causes,  mentioning  particularly  the  experi- 
ences of  Lord  Nelson  in  the  year  1741,  then  a captain 
in  the  British  Navy.  In  conclusion  Gen.  Greely  says  : 

“It  is  thus  apparent  that  the  establishment  of  a military  post  in  Nica- 
ragua or  the  occupation  of  the  country  by  a body  of  troops  is  a problem 
which  demands,  in  all  its  details,  unusual  sagacity  as  regards  the  supply 
of  food,  the  stock  of  clothing,  the  means  of  transportation  and  the  hous- 
ing of  troops.” 


26 


(Senate  Ex.  Doc.  No.  74,  53d  Cong.,  2d  Session,  pp. 
42-44.) 

2.  The  impolicy  of  attempting  to  use  the  Nicaragua 
Canal  as  a channel  for  the  passage  of  navy  vessels  in 
time  of  war  is  indicated  by  the  following  extract  from 
the  report  of  the  Nicaragua  Canal  Board  of  1895,  of 
which  Lieut.  Col.  (now  Brig.  Gen.)  William  Ludlow,  of 
the  Corps  of  Engineers,  U.  S.  Army,  was  chairman: 

‘‘It  is  proper  to  note  the  multiplied  points  at  which 
the  canal  would  be  exposed  to  injury  after  construction, 
and  the  comparative  facility  with  which  a breach  could 
be  made  at  any  point  on  the  long  line  of  embankments, 
if  for  any  reason,  military  or  malicious,  it  should  be 
intended  to  destroy  the  canal  navigation  until  the  breach 
could  be  closed.”  (H.  R.  Doc.  No.  279,  54th  Cong.,  1st 
Session.) 

3.  At  a hearing  before  the  Committee  on  Interstate 
and  Foreign  Commerce  of  the  House  of  Representatives, 
held  April  17,  1896,  Commodore  Mordecai  T.  Endicott, 
a civil  engineer  of  the  United  States  Navy,  then  a mem- 
ber of  the  Nicaragua  Canal  Board,  and  now  Chief  of 
the  Bureau  of  Yards  and  Docks  in  the  Navy  Depart- 
ment, was  asked  the  question  whether,  in  his  opinion, 
“ it  would  be  a feature  of  weakness  in  our  military  and 
naval  status  if  we  build  the  Nicaragua  Canal.”  Com- 
modore Endicott  replied  as  follows  : 

“I  think  in  case  of  war  with  a country  like  Great 
Britain  we  might  have  to  blow  up  the  locks  and  abandon 
it.  I do  not  think  we  could  hold  it  against  Great 
Britain.”  (Hearings  on  House  Bill  35,  page  105,  April 
17,  1898.) 

This  answer  implies  that  the  Nicaragua  Canal  would 
be  “ a feature  of  weakness  in  our  military  and  naval 
status  ” in  the  event  of  war  with  any  considerable  naval 
power.  This  point  might  well  be  submitted  for  investi- 


27 


gation  to  a commission  of  military  officers  fully  compe- 
tent to  pass  upon  it. 

From  the  foregoing  and  other  reliable  evidence  it 
appears  to  be  beyond  all  question  that  the  availability 
of  the  Nicaragua  Canal  for  the  passage  of  war  vessels 
would  involve  the  construction  of  expensive  fortifica- 
tions at  either  end  and  defenses  at  all  exposed  points 
along  its  line.  It  would  also  be  necessary,  in  time  of 
war,  to  provide  in  a foreign  country  an  adequate  mili- 
tary guard  along  the  entire  line,  and  to  station  an  ade- 
quate force  at  either  end  in  order  to  prevent  the  destruc- 
tion of  the  canal  at  a hundred  vulnerable  points  by 
means  of  torpedoes  and  mines,  in  order  to  prevent  the 
destruction  of  vessels  by  the  same  means  along  the  en- 
tire line  of  the  canal,  and  in  order  to  prevent  the  sinking 
of  obstructions  at  the  entrance  to  the  narrow  artificial 
harbors  at  either  end  of  the  canal,  which  obstructions 
might  require  months  for  their  removal,  and  for  the  de- 
fense of  the  canal  against  formidable  naval  and  military 
assault. 

The  vulnerable  points  alluded  to  are  locks,  dams, 
culverts  and  embankments.  The  Suez  Canal  being  a 
sea-level  canal  through  Arabian  sands  is  not  subject  to 
these  particular  infirmities.  But  a war-ship  in  a canal 
is,  under  any  circumstances,  a helpless  and  a harmless 
thing. 

In  a word,  judged  by  the  single  test  of  military  pro- 
tection, the  adequate  defense  of  the  Nicaragua  Canal 
would  be  a source  of  weakness  rather  than  of  power. 

The  idea  sought  to  be  inculcated  by  advocates  of  the 
Nicaragua  Canal  that  the  U.  S.  war-ship  Oregon 
would  have  passed  through  the  Nicaragua  Canal  if  it 
had  been  constructed,  instead  of  making  her  famous 
voyage  around  Cape  Horn,  is  absolutely  negatived  by 
these  statements.  The  Government  of  the  United  States 


28 


was  not  then  in  condition  to  afford  the  proper  protec- 
tion of  the  canal  either  by  the  Army  or  the  Navy.  If 
such  protection  had  been  afforded  it  would  have  been 
at  an  expenditure  of  military  power  and  of  money 
greatly  exceeding  that  involved  in  the  voyage  of  the 
Oregon  around  Cape  Horn.  That  such  protection  would 
have  been  necessary  is  also  evident  from  the  fact  that 
the  line  of  the  canal  passes  through  the  territory  of  a 
people  belonging  to  the  Spanish  race  and  in  sympathy 
with  Spain  in  the  issue  of  war  then  impending. 

The  barrier  to  navigation  interposed  by  the  American 
isthmus  from  Mexico  to  South  America  affords  vastly 
greater  military  advantage  to  the  United  States  than 
would  any  artificial  channel  through  it  having  a width 
of  only  about  250  feet  at  the  surface,  especially  in  view 
of  the  fact  that  men  and  materials  of  war  can  be  trans- 
ported across  the  continent  by  rail — a privilege  denied 
to  other  naval  powers. 

An  army  of  eight  hundred  thousand  men  with  all 
their  munitions  of  war  can  be  transported  across  the 
continent  by  rail  within  the  space  of  twenty  days.  In 
case  the  Nicaragua  Canal  should  be  constructed,  and 
neutralized  so  as  to  admit  the  free  and  unmolested  pas- 
sage of  war-ships  of  other  nations, ‘both  in  peace  and 
in  war,  as  provided  in  the  Clayton-Bulwer  treaty,  and 
as  has  been  established  in  regard  to  the  Suez  Canal,  this 
particular  military  advantage  now  en j oyed  by  the  U nited 
States  would  be  absolutely  annulled,  as  an  enemy  would 
be  enabled  to  pass  not  only  his  war-ships  but  also  his 
troopships  and  other  transports  through  the  canal  un- 
molested. 

The  assumed  need  of  an  isthmian  canal  for  military 
purposes  is  obviated  by  the  fact  that  an  adequate  force 
of  naval  vessels  can  be  constructed  for  the  perfect  de- 
fense of  our  Pacific  Coast  ports  at  one-tenth  the  cost  of 


29 


the  Nicaragua  Canal.  Such  naval  force  would  be  ever 
present  and  therefore  much  more  reliable  as  a means  of 
defense  than  the  shifting  of  great  naval  vessels  from 
one  side  of  the  continent  to  the  other  in  time  of  war. 
In  the  light  of  current  events  and  of  an  awakened  public 
sentiment  there  can  be  no  doubt  that  such  additional 
naval  force  will  be  provided  within  the  next  three  years. 

And  yet  in  the  face  of  all  the  facts  and  reasons  which 
go  to  make  up  a just  estimate  as  to  the  military  value 
of  the  Nicaragua  Canal,  proponents  of  the  scheme  per- 
sist in  the  declaration  that  it  is  of  inestimable  military 
importance. 

The  whole  question  is  evidently  one  which  should  be 
submitted  to  thorough  and  impartial  official  investiga- 
tion by  a commission  composed  of  army  and  navy 
officers  of  proven  ability  and  knowledge.  I earnestly 
plead  for  such  investigation.  The  proponents  of  the 
Nicaragua  Canal  are  making  vigorous  effort  to  prevent 
such  investigation. 

Aside  from  the  assumed  merits  of  the  Nicaragua 
Canal  from  the  military  point  of  view  the  case  is  hope- 
lessly complicated  by  the  blundering  and  most  unfor- 
tunate Clayton-Bulwer  treaty.  This  feature  of  the 
case  demands  particular  attention. 

THE  CLAYTON-BULWER  TREATY  AND  THE 
NICARAGUA  CANAL. 

The  famous  Clayton-Bulwer  treaty  was  concluded  at 
Washington,  D.  C.,  April  19,  1850,  between  John  M. 
Clayton,  Secretary  of  State  of  the  United  States,  and 
Sir  Henry  Lytton  Bulwer,  Envoy  Extraordinary  and 
Minister  Plenipotentiary  of  Great  Britain.  Zachary 
Taylor  was  then  President  of  the  United  States.  (See 
Appendix  A.) 


30 


The  terms  of  this  treaty  which  have  ever  since  hope- 
lessly compromised  the  military  possibilities  of  any 
trans-isthmian  canal  are  as  follows : 

1.  The  treaty  provides  that  neither  Great  Britain  nor 
the  United  States  shall  ever  obtain  or  maintain  any  ex- 
clusive control  over  the  Nicaragua  Canal  for  either  mil- 
itary or  commercial  purposes  nor  “ ever  erect  or  main- 
tain any  fortifications  commanding  the  same  or  in  the 
vicinity  thereof. ” 

2.  It  stipulates  that  the  two  contracting  nations  shall 
invite  other  nations  to  join  them  in  this  “ neutraliza- 
tion” of  the  proposed  canal  both  in  time  of  peace  and 
of  war. 

3.  It  stipulates  that  both  nations  shall  endeavor 
to  extend  the  terms  of  the  treaty  to  every  interoceanic 
canal  or  railroad  project  from  Tehuantepec  to  Panama, 
and  declares  that  the  intention  of  the  two  governments 
in  entering  into  the  convention  was  not  only  “ to  ac- 
complish a particular  object  but  also  to  establish  a gen- 
eral principle  ” 

Undoubtedly  the  main  object  had  in  view  by  the 
British  negotiators  was  to  break  down  the  “ Monroe 
Doctrine,”  a purpose  which  escaped  the  notice  of  the 
American  negotiators  until  too  late. 

The  enormous  blunders  involved  in  this  treaty  were 
soon  discovered.  It  not  only  contravenes  the  cherished 
Monroe  Doctrine,  but  it  denies  to  the  United  States 
any  peculiar  commercial  or  military  advantages  which 
it  might  possibly  enjoy  from  a canal  under  its  exclusive 
control. 

An  attempt  was  made  to  modify  the  Clayton-Bul- 
wer  treaty  by  Secretary  Marcy,  in  the  year  1853,  dur- 
ing the  administration  of  President  Pierce.  In  his  first 
annual  message  to  Congress,  December  8,  1857,  Presi- 
dent Buchanan  recommended  the  abrogation  of  the 
treaty.  But  these  efforts  came  to  naught. 


31 


By  joint  resolution  adopted  April  16,  1880,  Congress 
requested  President  Hayes  to  “ take  immediate  steps 
for  the  formal  and  final  abrogation  of  the  Clayton- 
Bulwer  treaty.”  Before  anything  had  been  accom- 
plished in  that  direction  President  Garfield  was  installed 
and  Secretary  Blaine  took  the  matter  vigorously  in 
hand.  On  November  19,  1881,  he  addressed  a dispatch 
to  Mr.  Lowell,  our  Minister  in  London,  stating  the  indis- 
putable fact  that  the  treaty  “concedes  to  Great  Britain 
the  control  of  whatever  canal  may  be  constructed.” 
But  the  diplomatic  efforts  of  Secretary  Blaine  for  the 
abrogation  of  the  Clayton-Bulwer  treaty  were  ineffect- 
ual, as  were  also  those  of  his  successor,  Mr.  Freling- 
huysen,  under  President  Arthur.  In  referring  to  these 
failures,  Professor  Keasbey  says  : * 

“There  can  be  little  doubt  that  Great  Britain  will 
continue  for  the  present  to  oppose  our  claim,  and  her 
objections  will  moreover  be  perfectly  well  justified  by 
the  terms  of  the  Clayton-Bulwer  treaty  still  extant. 
Our  diplomatic  demands  will  therefore  scarcely  be  al- 
lowed by  our  rival,  and  peremptory  notice  on  our  part 
of  immediate  abrogation  of  the  convention  might  pre- 
cipitate a conflict  in  other  directions  for  which  we  are 
by  no  means  prepared.” 

This  was  written  two  years  ago.  Presumably  the  ab- 
rogation of  the  blundering  and  compromising  Clayton- 
Bulwer  treaty  would  be  more  difficult  to-day  than  it 
was  then. 

Certain  advocates  and  proponents  of  the  Nicaragua 
Canal  maintain,  however,  that  the  Clayton-Bulwer 
treaty  is  void  or  voidable  from  the  fact  that  the  Nica- 
ragua Canal,  to  which  it  relates,  has  not  been  con- 
structed. The  more  logical  view,  which  seems  to  be 

* The  Nicaragua  Canal  and  the  Monroe  Doctrine,  by  Professor  Lindley 
Miller  Keasbey,  page  596. 


32 


quite  generally  accepted  by  American  statesmen  and 
by  all  British  statesmen,  is  that  the  main  purpose  and 
spirit  of  the  treaty  was  the  neutralization  of  any  isth- 
mian canal  which  may  be  constructed  and  that  this 
purpose  is  persistent,  and  not  dependent  upon  the  con- 
struction of  any  particular  canal.  This  view  is  sus- 
tained by  the  fact  that  the  Clayton-Bulwer  treaty  does  not 
require  either  the  government  of  the  United  States  or  of 
Great  Britain  to  furnish  ‘‘the  necessary  capital”  for 
the  construction  of  the  Nicaragua  Canal,  or  any  other 
canal,  thus  indicating  that  the  main  object  of  the 
treaty  was  in  its  own  language  “to  establish  a general 
principle,”  namely,  to  secure  the  neutrality  of  any 
isthmian  canal  which  might  be  constructed. 

As  minister  to  Great  Britain,  Mr.  Buchanan  declared 
in  January,  1854,  that 

“ The  main  feature  of  the  policy  which  dictated  the  Clayton- 
Bulwer  CONVENTION  WAS  TO  PREVENT  EITHER  GREAT  BRITAIN  OR  THE 
United  States  from  being  placed  in  a position  to  exercise  exclu- 
sive CONTROL,  IN  PEACE  OR  WAR,  OVER  ANY  OF  THE  GRAND  THOROUGH- 
FARES BETWEEN  THE  TWO  OCEANS.” 

Again,  as  President,  Mr.  Buchanan  said,  in  his  mes- 
sage to  Congress,  December  8,  1857:  “In  the  United 
States  we  believe  that  this  treaty  would  place  both 
powers  upon  an  exact  equality  by  the  stipulation  that 
neither  will  ever  ‘ occupy,  or  fortify,  or  colonize,  or  as- 
sume or  exercise  any  dominion’  over  any  part  of  Cen- 
tral America.” 

Lewis  Cass,  Secretary  of  State  under  President 
Buchanan,  in  a communication  to  Lord  Napier,  British 
minister  to  the  United  States,  under  date  of  November 
8,  1858,  said  : 

“What  the  United  States  want  in  Central  America,  next  to 

THE  HAPPINESS  OF  ITS  PEOPLE,  IS  THE  SECURITY  AND  NEUTRALITY  OF 
THE  INTEROCEANIC  ROUTES  WHICH  LEAD  THROUGH  IT.” 

Secretary  Seward  strongly  inclined  to  this  view.  It 
would  seem  that  the  foregoing,  including  the  opinion 


33 


of  Mr.  Blaine,  ought  to  be  regarded  as  conclusive  upon 
the  point  that  the  Clayton-Bulwer  treaty  does  “ neutral- 
ise ” the  Nicaragua  Canal,  thus  debarring  the  United 
States  from  any  exclusive  control  of  it  until  that  treaty 
is  abrogated. 

There  were  economic  and  commercial  blunders  in- 
volved in  the  Clayton-Bulwer  treaty  even  more  glaring 
than  that  described.  With  the  exception  of  a few  sub- 
sidized trans-Atlantic  steamers,  and  ocean  steamers 
engaged  on  a few  other  important  passenger  routes,  the 
vessels  engaged  in  international  commerce  in  1850  were 
all  sailing  vessels.  But,  as  already  shown,  the  Nica- 
ragua Canal  would  not  have  been,  and  would  not  now 
be,  available  for  the  passage  of  sailing  vessels.  Hence 
it  would  have  been  absolutely  worthless  as  an  avenue 
of  commerce  if  it  had  been  constructed  in  the  year  1850. 

The  Clayton-Bulwer  treaty  of  1850  encountered  an- 
other economic  and  commercial  obstacle  fatal  to  its 
purpose  of  constructing  a Nicaragua  canal.  It  was 
impossible  for  the  framers  of  that  treaty  to  forecast  the 
effect  upon  the  Nicaragua  route  of  the  competition  of 
rival  lines,  not  then  in  existence.  In  this  respect  the 
march  of  time  has  radically  changed  the  conditions  and 
consequently  the  course  of  the  world’s  commercial 
movements.  Some  of  the  principal  of  these  rival  lines 
of  transportation  may  be  noticed. 

a.  When  the  Clayton-Bulwer  treaty  was  concluded 
in  1850  the  construction  of  the  Panama  Railroad  was 
in  its  incipient  stage.  It  was  opened  for  traffic  Janu- 
ary 26,  1855.  It  proved  to  be  an  exceedingly  valuable 
highway  of  commerce,  until  in  a great  degree  eclipsed 
by  the  transcontinental  railroads  of  the  United  States. 

b.  In  the  year  1850  the  Suez  Canal  had  not  even  been 


34 


projected.  Its  construction  was  begun  August  25, 1859, 
and  it  was  opened  for  traffic  November  17,  1869.  It  is 
now  one  of  the  chief  avenues  of  interoceanic  commerce, 
and,  as  already  shown,  it  forever  precludes  the  idea  of 
commerce  between  the  United  States  and  Asia,  or  be- 
tween Europe  and  Asia  by  any  American  isthmian 
canal  route. 

c.  When  the  blundering  Nicaragua  Canal  treaty  of 
1850  was  signed,  the  idea  of  constructing  a railroad 
across  this  continent  was  chimerical.  Two  thousand 
miles  of  territory,  the  Rocky  Mountains,  arid  deserts, 
hostile  Indian  tribes  and  economic  conditions  affecting 
the  possibilities  of  the  railroad  itself  then  forbade  the 
serious  consideration  of  such  a scheme.  But  we  have 
lived  in  an  age  of  economic  and  commercial  wonders. 
The  construction  of  the  first  transcontinental  railroad 
was  begun  in  the  year  1862,  and  the  line  was  opened 
for  traffic  May  10,  1869.  Seven  other  lines  and  parts  of 
lines  have  since  been  constructed  in  the  United  States. 
Transcontinental  traffic  has  enormously  increased  and 
rates  have  greatly  fallen.  Thus  the  need  of  a Nicara- 
gua Canal  has  been  absolutely  eliminated.  And  yet  it  is 
hard  to  dispel  from  the  public  mind  the  visions  of  nearly 
half  a century  ago,  visions  which  found  expression 
in  the  absurd  Clayton-Bulwer  treaty  and  in  the  Nica- 
ragua Canal  project.  The  present  demand  for  the  con- 
struction of  that  canal  is  a mere  echo  of  conditions 
erroneously  supposed  to  have  prevailed  in  the  year 
1850,  and  it  is  an  echo  which  answers — where  ? I be- 
speak for  this  subject  a thorough  and  impartial  investi- 
gation by  Congress.  That  the  proponents  of  the  Nica- 
ragua Canal  will  oppose  such  investigation  seems  to  go 
without  saying. 


35 


THE  ATTITUDE  OF  THE  CENTRAL  AMERICAN 

STATES  TOWARD  THE  MARITIME  CANAL  OF 

NICARAGUA. 

There  is  another  political  aspect  of  the  Nicaragua 
Canal  project  which  demands  careful  investigation  by 
the  Government  of  the  United  States  before  embarking 
in  its  construction.  I refer  to  the  attitude  of  Nicara- 
gua, Costa  Rica  and  the  new  republic  styled  “the 
United  States  of  Central  America,”  which  came  into 
existence  November  1,  1898. 

In  December,  1897,  the  government  of  Nicaragua 
granted  to  the  Atlas  Steamship  Company  of  London  a 
thirty-year  franchise  for  the  exclusive  steam  navigation 
on  Lake  Nicaragua  and  the  San  Juan  River,  together 
with  ample  rights  for  the  construction  of  railroads. 
This  privilege  will  unquestionably  divert  almost  all  of 
the  commerce  of  Nicaragua — internal  as  well  as  for- 
eign— from  the  Nicaragua  Canal  in  case  it  shall 
be  built.  Such  procedure  on  the  part  of  Nicaragua 
clearly  manifests  net  only  lack  of  confidence  in'  the 
Maritime  Canal  Company  of  Nicaragua,  but  also  a spirit 
of  hostility  toward  it.  Recent  events  more  clearly  in- 
dicate that  disposition.  On  October  28,  1898,  it  was 
announced  that  Nicaragua  had  contracted  with  certain 
New  York  and  Chicago  parties  for  the  construction  of 
the  Nicaragua  Canal,  such  concession  to  take  effect 
next  October  when  tb&  concession  to  the  Maritime 
Canal  Company  of  Nicaragua  will  lapse.  This  not 
only  discredits  the  latter  company  but  manifests  a spirit 
of  enmity  toward  it.  It  likewise  compromises  the  rela- 
tions of  the  United  States  to  that  company  and  to  Nica- 
ragua. 

Another  matter  of  great'  significance  is  contained  in 
the  announcement  that  on  November  1, 1898,  Nicaragua, 


36 


Salvador  and  Honduras  had  united  in  forming  a new 
republic  styled  “The  United  States  of  Central  America.” 
It  is  provided  that  the  Nicaragua  Canal  shall,  as  a na- 
tional project,  pass  under  the  control  of  the  new  nation. 

At  the  present  writing  the  announcement  is  made  in 
the  public  press  that  the  President  of  Costa  Rica  has 
arrived  in  New  York  and  that  he  denies  the  conclusive- 
ness of  the  new  contract  entered  into  on  October  28th 
by  Nicaragua,  for  the  reason  that  the  canal,  if  con- 
structed upon  the  route  decided  upon,  would  trench 
upon  Costa  Rican  territory. 

It  is  impossible  to  arrive  at  any  definite  conclusion 
as  to  what  course  the  Government  of  the  United  States 
is  likely  to  pursue  in  regard  to  the  changed  conditions 
which  have  thus  been  introduced  by  Nicaragua  or  what 
will  be  the  political  effect  of  the  creation  of  the  new 
republic  upon  the  attitude  which  the  United  States  can 
or  ought  to  assume  in  regard  to  the  Nicaragua  Canal. 
Unquestionably  the  subject  should  be  thoroughly  in- 
vestigated by  Congress  before  committing  our  Govern- 
ment to  any  financial  obligations  for  the  construction 
of  the  canal. 

CONCLUSION. 

In  the  face  of  all  the  facts  thus  presented,  one  of  the 
chief  proponents  of  the  Nicaragua  Canal  scheme  has 
recently  declared  that  the  Nicaragua  Canal  bill  is  to  be 
forced  through  Congress  at  itsjiext  session,  which  ends 
March  4,  1899.  This  means  that  an  attempt  will  be 
made  to  forestall  any  investigation  of  the  economic, 
commercial,  military  or  political  aspects  of  the  project, 
or  in  regard  to  the  propaganda  by  which  the  people  of 
this  country  have  been  deluded  as  to  the  true  character 
of  the  scheme. 

I stand  for  the  economic  verities ; I stand  for  the 
logic  of  conditions,  and  in  so  doing  1 plead  for  a 


37 


thorough  aud  impartial  official  investigation  of  the 
economic,  commercial,  military  and  political  aspects 
of  the  Nicaragua  Canal  project  by  a competent  com- 
mission, upon  which  there  shall  be  placed  no  advocate 
of  the  Nicaragua  Canal  or  person  recommended  by 
any  proponent  of  the  canal  or  in  its  interest,  and  no 
person  known  to  be  an  opponent  of  the  canal,  or  in 
any  manner  interested  in  or  employed  by  any  railroad 
or  other  corporation  assumed  to  be  at  rivalry  with  the 
canal.  The  country  demands  the  truth,  the  whole 
truth,  and  nothing  but  the  truth  in  regard  to  the  prac- 
ticability of  the  Nicaragua  Canal  project.  Investigate ' 
before  investing. 

JOSEPH  NIMMO,  Jr. 

. Huntington,  Long  Island,  N.  Y.,  Nov.  25,  1898.. 


APPENDIX  A. 


CONVENTION  RELATIVE  TO  A SHIP  CANAL 
BY  WAY  OF  NICARAGUA,  COSTA  RICA,  THE 
MOSQUITO  COAST,  OR  ANY  PART  OF 
CENTRAL  AMERICA. 

Concluded  April  19,  1850  ; ratifications  exchanged  at 
Washington  July  4,  1850  ; proclaimed  July  5,  1850. 
The  United  States  of  America  and  Her  Britannic 
Majesty,  being  desirous  of  consolidating  the  relations 
of  amity  which  so  happily  subsist  between  them  by 
setting  forth  and  fixing  in  a convention  their  views  and 
intentions  with  reference  to  any  means  of  communica- 
tion by  ship-canal  which  may  be  constructed  between 
the  Atlantic  and  Pacific  Oceans  by  way  of  the  river 
San  Juan  de  Nicaragua,  and  either  or  both  of  the  lakes 
of  Nicaragua  or  Managua,  to  any  port  or  place  on  the 
Pacific  Ocean,  the  President  of  the  United  States  has 
conferred  full  powers  on  John  M.  Clayton,  Negotiators 

Secretary  of  State  of  the  United  States, 
and  Her  Britannic  Majesty  on  the  Right  Honourable  Sir 
Henry  Lytton  Bulwer,  a member  of  Her  Majesty’s 
Most  Honourable  Privy  Council,  Knight  Commander  of 
the  Most  Honourable  Order  of  the  Bath,  and  Envoy 
Extraordinary  and  Minister  Plenipotentiary  of  Her 
Britannic  Majesty  to  the  United  States,  for  the  aforesaid 
purpose;  and  the  said  Plenipotentiaries,  having  ex- 
changed their  full  powers,  which  were  found  to  be  in 
proper  form,  have  agreed  to  the  following  articles  : 

Article  I. 

The  Governments  of  the  United  States  and  Great 
Britain  hereby  declare  that  neither  the  Control  over  the 
one  nor  the  other  will  ever  obtain  or  main-  proposed  canal, 
tain  for  itself  any  exclusive  control  over  the  said  ship- 
canal  ; agreeing  that  neither  will  ever  erect  or  maintain 
any  fortifications  commanding  the  same,  or  in  the 


40 


vicinity  thereof,  or  occupy,  or  fortify,  or  colonize,  or 
assume  or  exercise  any  dominion  over  Nicaragua,  Costa 
Rica,  the  Mosquito  coast,  or  any  part  of  Central 
America  ; nor  will  either  make  use  of  any  protection 
which  either  affords  or  may  afford,  or  any  alliance 
which  either  has  or  may  have  to  or  with  any  State  or 
people  for  the  purpose  of  erecting  or  maintaining  any 
such  fortifications,  or  of  occupying,  fortifying  or  col- 
onizing  Nicaragua,  Costa  Rica,  the  Mosquito  coast,  or 
any  part  of  Central  America,  or  of  assuming  or  exer- 
cising dominion  over  the  same  ; nor  will  the  United 
States  or  Great  Britain  take  advantage  of  any  intimacy,  j 
or  use  any  alliance,  connection  or  influence  thateither 
may  possess,  with  any  State  or  Government  through 
whose  territory  the  said  canal  may  pass,  for  the  pur- 
pose of  acquiring  or  holding,  directly  or  indirectly,  for 
the  citizens  or  subjects  of  the  one  any  rights  or  advant- 
ages in  regard  to  commerce  or  navigation  through  the 
said  canal  which  shall  not  be  offered  on  the  same  terms 
to  the  citizens  or  subjects  of  the  other. 

Article  II. 

Vessels  of  the  United  States  or  Great  Britain  trav- 
ersing the  said  canal  shall,  in  case  of  war 
between  the  contracting  parties,  be  ex-  sei^traversing  the 
empted  from  blockade,  detention,  or  cap- 
ture by  either  of  the  belligerents  ; and  this  provision 
shall  extend  to  such  a distance  from  the  two  ends  of 
the  said  canal  as  may  hereafter  be  found  expedient  to 
establish. 

Article  III. 

In  order  to  secure  the  construction  of  the  said  canal, 
the  contracting  parties  engagethat,  if  any  Pr9perty  of  the 
such  canal  shall  be  undertaken  upon  fair  ^o^truct^gthe 
and  equitable  terms  by  any  parties  having  canaL 
the  authority  of  the  local  government  or  governments 
through  whose  territory  the  same  may  pass,  then  the 
persons  employed  in  making  the  said  canal,  and  their 
property  used  or  to  be  used  for  that  object,  shall  be 
protected,  from  the  commencement  of  the  said  canal  to 
its  completion,  by  the  Governments  of  the  United  States 


41 


md  Great  Britain,  from  unjust  detention,  confiscation, 
seizure  or  any  violence  whatsoever. 

Article  IV. 

The  contracting  parties  will  use  whatever  influence 
they  respectively  exercise  with  any  State, 
wCo0rksttocb0enf0acme  States  or  Governments  possessing,  or 
tated-  claiming  to  possess,  any  jurisdiction  or 

right  over  the  territory  which  the  said  canal  shall 
traverse  or  which  shall  be  near  the  waters  applicable 
thereto,  in  order  to  induce  such  States  or  Governments 
to  facilitate  the  construction  of  the  said  canal  by  every 
means  in  their  power  ; and,  furthermore,  the  United 
States  and  Great  Britain  agree  to  use  their  good  offices, 
wherever  or  however  it  may  be  most  expedient,  m 
order  to  procure  the  establishment  of  two 
Free  ports.  f ree  ports  one  at  each  end  of  the  said  canal. 

Article  V. 

The  contracting  parties  further  engage  that  when 
the  said  canal  shall  have  been  completed 
Neutrality  of  canal.  they  win  protect  it  from  interruption, 

seizure  or  unjust  confiscation,  and  that  they  will  guar- 
antee the  neutrality  thereof,  so  that  the  said  canal  may 
forever  be  open  and  free,  and  the  capital  invested 
therein  secure.  Nevertheless,,  the  Governments  of  the 
United  States  and  Great  Britain,  in  according  their  pro- 
tection to  the  construction  of  the  said  canal,  and  gnar- 
anteeing  its  neutrality  and  security  when  completed, 
always  understand  that  this  protection  and  guarantee 
are  granted  conditionally,  and  may  be  withdrawn  by 
both  Governments,  or  either  Government,  if  both  Gov- 
ernments or  either  Government  should  deem  that  the 
persons  or  company  undertaking  or  managing  the  same 
adopt  or  establish  such  regulations  concerning  the 
traffic  thereupon  as  are  contrary  to  the  spirit  and  inten- 
tion of  this  convention,  either  by  making  unfair  dis- 
criminations in  favor  of  the  commerce  of  one  of  the 
contracting  parties  over  the  commerce  of  the  other,  or 
by  imposing  oppressive  exactions  or  unreasonable  tolls 
upon  passengers,  vessels,  goods,  wares,  merchandise  or 
other  articles.  Neither  party,  however,  shall  withdraw 


4 2 


the  aforesaid  protection  and  guarantee  without  first 
giving  six  months’  notice  to  the  other. 

Article  VI. 

The  contracting  parties  in  this  convention  engage  to 
invite  every  State  with  which  both  or  either  have 
friendly  intercourse  to  enter  into  stipulations  with  them 
similar  to  those  which  they  have  entered  into  with  each 
other,  to  the  end  that  all  other  States  may  share  in  the 
honor  and  advantage  of  having  contributed  to  a work 
of  such  general  interest  and  importance  as  the  canal 
herein  contemplated.  And  the  contracting  parties  like- 
wise agree  that  each  shall  enter  into  treaty 
to  be  made  with  Cen-  stipulations  with  such  of  the  Central 
trai  American  states.  American  States  as  they  may  deem  advis- 
able for  the  purpose  of  more  effectually  carrying  out 
the  great  design  of  this  convention,  namely,  that  of 
constructing  and  maintaining  the  said  canal  as  a ship 
communication  between  the  two  oceans  for  the  benefit 
of  mankind,  on  equal  terms  to  all  and  of  protecting  the 
same  ; and  they  also  agree  that  the  good  offices  of  either 
shall  be  employed,  when  requested  by  the  other,  in  aid- 
Differences  as  to  ing  and  assisting  the  negotiation  of  such 
right  over  territory,  treaty  stipulations  ; and  should  any  differ- 
ences arise  as  to  the  right  of  property  over  the  territory 
through  which  the  said  canal  shall  pass,  between  the 
States  or  Governments  of  Central  America,  and  such 
differences  should  in  any  way  impede  or  obstruct  the 
execution  of  the  said  canal,  the  Governments  of  the 
United  States  and  Great  Britain  will  use  their  good 
offices  to  settle  such  differences  in  the  manner  best 
suited  to  promote  the  interests  of  the  said  canal,  and  to 
strengthen  the  bonds  of  friendship  and  alliance  which 
exist  between  the  contracting  parties. 

Article  VII. 

It  being  desirable  that  no  time  should  be  unneces- 
sarily lost  in  commencing  and  constructing  the  said 
canal,  the  Governments  of  the  United 
te5edlinto  Without  States  and  Great  Britain  determine  to  give 
their  support  and  encouragement  to  such 


43 


persons  or  company  as  may  first  offer  to  commence  the 
same,  with  the  necessary  capital,  the  consent  of  the 
local  authorities,  and  on  such  principles  as  accord  with 
the  spirit  and  intention  of  this  convention  ; and  if  any 
persons  or  company  should  already  have,  with  any  State 
through  which  the  proposed  ship-canal  may  pass,  a con- 
tract for  the  construction  of  such  canal  as  that  speci- 
fied in  this  convention,  to  the  stipulations  of  which 
contract  neither  of  the  contracting  parties  in  this  con- 
vention have  any  just  cause  to  object,  and  the  said 
persons  or  company  shall,  moreover,  have  made  prepa- 
rations and  expended  time,  money  and  trouble  on  the 
faith  of  such  contract,  it  is  hereby  agreed  that  such 
persons  or  company  shall  have  a priority  of  claim  over 
every  other  person,  persons  or  company  to 
contractors  already  the  protection  of  the  Governments  of  the 
United  States  and  Great  Britain,  and  be 
allowed  a year  from  the  date  of  the  exchange  of  the 
ratifications  of  this  convention  for  concluding  their 
arrangements  and  presenting  evidence  of  sufficient 
capital  subscribed  to  accomplish  the  contemplated  un- 
dertaking ; it  being  understood  that  if,  at  the  expiration 
of  the  aforesaid  period,  such  persons  or  company  be  not 
able  to  commence  and  carry  out  the  proposed  enterprise, 
then  the  Governments  of  the  United  States  and  Great 
Britain  shall  be  free  to  afford  their  protection  to  any 
other  persons  or  company  that  shall  be  prepared  to 
commence  and  proceed  with  the  construction  of  the 
canal  in  question.. 

Article  VIII. 

The  Governments  of  the  United  States  and  Great 
Britain  having  not  only  desired,  in  entering  into  this  con- 
protection  to  be  vention,  to  accomplish  a particular  object* 
st1plniationbsVother  but  also  to  establish  a general  principle, 
communications,  they  hereby  agree  to  extend  their  protec- 
tion, by  treaty  stipulations,  to  any  other  practicable 
communications,  whether  by  canal  or  railway,  across 
the  isthmus  which  connects  North  and  South  America, 
and  especially  to  the  interoceanic  communications, 
should  the  same  prove  to  be  practicable,  whether  by 


44 


canal  or  railway,  which  are  now  proposed  to  be  estab- 
lished by  the  way  of  Tehuantepec  or  Panama.  In 
granting,  however,  their  joint  protection  to  any  such 
canals  or  railways  as  are  by  this  article  specified,  it  is 
always  understood  by  the  United  States  and  Great 
Britain  that  the  parties  constructing  or  owning  the 
same  shall  impose  no  other  charges  or  conditions  of 
traffic  thereupon  than  the  aforesaid  Governments  shall 
approve  of  as  just  and  equitable ; and  that  the  same 
canals  or  railways,  being  open  to  the  citi- 
zej£of°opteher cni:  zens  and  subjects  of  the  United  States  and 
Great  Britain  on  equal  terms,  shall  also  be 
open  on  like  terms  to  the  citizens  and  subjects  of  every 
other  State  which  is  willing  to  grant  thereto  such  pro- 
tection as  the  United  States  and  Great  Britain  engage 
to  afford. 

Article  IX. 

The  ratifications  of  this  convention  shall  be  exchanged 
at  Washington  within  six  months  from 
this  day  or  sooner  if  possible. 

In  faith  whereof  we,  the  respective  Plenipotentiaries, 
have  signed  this  convention  and  have  hereunto  affixed 
our  seals. 

Done  at  Washington  the  nineteenth  day  of  April, 
anno  Domini  one  thousand  eight  hundred  and  fifty. 


Ratifications. 


[SEAL.] 

[SEAL.] 


John  M.  Clayton. 
Henry  Lytton  Bulwer. 


APPENDIX  B. 


Value  of  the  commerce  of  the  United  States  (imports 
and  exports  combined)  with  Europe,  the  United  King- 
dom, Germany,  France,  Asia,  China,  Japan  and  Austra- 
lasia during  the  year  ended  June  30,  1898: 

(Prepared  by  the  Chief  of  the  Bureau  of  Statistics  of  the  Treasury 
Department,  Washington,  D.  C.,  Nov.  3,  1898.) 


Value  of  Commerce 
with  the 
United  States. 

Total,  Europe $1,279,739,936 

The  United  Kingdom 649,885,790 

Germany  224,737,350 

France 148,190,138 


Total,  Asia 137,302,384 

China,  including  Hong  Kong  ....  37,331,047 

Japan 45,609,151 


Total,  Australasia  21,188,761 

Total  foreign  commerce  of  the  United 

States  (all  nations) $1,847,531,984 


JOSEPH  NIMMO,  Jr., 


Statistician  and  Economist. 


Huntington, 

Long  Island,  N.  Y. 


1831  F Street  N.  W., 

Washington,  D.  C. 


SPECIAL  ATTENTION  GIVEN  TO  QUE8TION8  IN  REGARD  TO  COMMERCE,  TRANSPORTATION,  NAVI- 
GATION AND  INDUSTRY. 


